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South Asia Investor Review is focused on reporting, analyzing and discussing the economy and the financial markets of countries in South Asia, including Pakistan, Bangladesh and Sri Lanka. For investors looking to invest in emerging markets beyond BRIC countries (Brazil, Russia, India and China), this blog is designed to help international investors looking to learn about investing in South Asia with focus on Pakistan. Riaz has another blog called Haq's Musings at http://www.riazhaq.com

Pakistan Completes Construction of Over Half of CPEC Western Route

“The Frontier Works Organization (FWO) has built roads with 502 kilometers length on the western alignment of China Pakistan Economic Corridor (CPEC) to link Gwadar with other parts of the country. The FWO took up the challenge to extend the benefits of Gwadar port to rest of the country by building roads in rugged mountainous terrain and highly inaccessible areas. The gigantic task was undertaken on the directives of Chief of Army Staff General Raheel Sharif."Frontier Works Organization

Of the three land routes being constructed as part of the China-Pakistan Economic Corridor (CPEC) project to connect Pakistan's deep sea Gwadar Port on the Arabian Sea with western China, the western route is the most challenging. In addition to the difficult mountainous terrain in KP and Baluchistan provinces, the western route runs through Panjgur and Turbat where there is an active Baloch insurgency believed to be aided by India via Afghanistan. It's being built by Pakistan Army's Frontier Works Organization.

Deep Sea Port at Gwadar

Frontier Works Organization:

Frontier Works Organization (FWO) is an administrative branch of the Pakistan Army that includes active duty officers and civilian scientists and engineers which has been involved with the construction of bridges, roads, tunnels, airfields and dams in Pakistan, on the orders of the civilian government of Pakistan, according a Reuters report.

Three CPEC Routes: Western, Central and Eastern

Major Milestone:

The completion of construction of 502 km of the 870 km length of the western alignment represents a significant milestone for Pakistan Army and the Frontier Works Organization. It is expected to become operational by the end of 2016.

CPEC Projects Map

Indian Opposition:

India has made no secret of its strong opposition to the the CPEC project, and it is believed to be making covert efforts to sabotage it. Indian Foreign Minister Sushma Swaraj has said that Indian Prime Minister Narendra Modi “very strongly” raised the issue regarding China-Pakistan Economic Corridor (CPEC) during his visit to Beijing, and called the project “unacceptable”. Swaraj said Modi was “concerned” about the $46 billion project, adding that the Indian government had summoned a Chinese envoy to raise the issue over the corridor that is to run through Pakistani Kashmir. Needless to say that the Chinese dismissed India’s objections to the China-Pakistan Economic Corridor (CPEC).

Balochistan Insurgency:

In spite of Indian RAW's most determined effort to support the Baloch militants' campaign of murder and terror, the Baloch insurgency has been significantly weakened by the Pakistan Army campaign in the province. In 2013 earthquake that struck Awaran, a stronghold of Baloch insurgents, Pakistan Army moved in with relief supplies to earthquake victims, and managed to gain access to parts of the very volatile district that were considered inaccessible. More recently, the insurgency has been decimated by in-fighting among various Baloch insurgent factions. The 2014 death of veteran Baloch leader Khair Bux Marri has opened up a rift between his sons Mehran and Hyrbyair — who heads the BLA from self-exile in London — and led to the creation of the UBA with other groups also aligning themselves with one side or the other.

Pak Army Chief's Warning:

Pakistan Army Chief Raheel Sharif has shown a strong personal commitment to making it happen by visiting insurgency-hit areas to support the workers and the troops on difficult construction sites. He was emphatic during a ceremony to celebrate the Chinese Army’s 88th anniversary held at the country’s Islamabad embassy where he said, “I reiterate our resolve that any attempt to obstruct or impede this (CPEC) project will be thwarted at all costs".

Summary:

Construction work on CPEC is already stimulating economic activity in Pakistan as indicated by rising domestic cement demand in the country. It was up 8% year over year in 2014-15. Cement sales are considered a barometer of development activity. A recent assessment by Ruchir Sharma, head of Morgan Stanley's emerging markets, has said Pakistan's economy is growing more than twice as fast as emerging markets other than India and China. In a piece titled "Bucking stagnation elsewhere, the quiet rise of South Asia", Sharma particularly mentions the Chinese CPEC investment of $46 billion as a positive for Pakistan. "Pakistan’s manufacturing sector is now growing, due to both increasing electric output and the fact that – like Bangladesh – its young population and labour force is expected to continue expanding for at least the next five years", says Sharma.

Pakistan has the potential to be a global turnaround story. I recently spent time in-country listening to a wide range of perspectives and I am convinced that U.S. policymakers and business leaders need to look at Pakistan beyond the security lens. Getting our relationship right will require deeper thinking and action on issues around trade and investment, education, and broader economic development. The United States ought to be Pakistan’s preferred partner given its 70-year relationship. But in order to participate in the upside of the Pakistan story, the United States will need to view Pakistan not as a problem to be solved but as a potential partner. There are several changes that suggest the United States should soon act on this opportunity.

The Pakistan of today is similar to that of Colombia in the late 1990s. Back then, words like “drugs, gangs, and failed state” were freely associated with the Andean country. Today, Colombia has a free trade agreement with the United States, a stable 3.5 percent annual GDP growth, a free trade agreement with the United States, and security is vastly improved. Similarly, Western headlines on Pakistan today gloss over the progress on the security front, the increased political stability, and incremental progress on the economic front. In spite of this potential for Pakistan, it continues to suffer from a terrible country brand that has not caught up with realities on the ground.

Action Against the Taliban

Pakistan’s improving security dynamic is the first change to note. It is hard to understate the before-and-after effects of the Taliban’s horrendous December 2014 attack on a military-owned elementary school in Peshawar that killed 145 people, including 132 schoolchildren aged eight to eighteen. Almost immediately after the attack, the military responded in force by taking out 157 terrorists via air strikes and ground operations in the North Waziristan and Khyber tribal areas adjacent to Peshawar.

What has not sunk into international perceptions about the country is the tangible consensus among government, military, and Pakistani citizens against violent terrorists including the Pakistani Taliban and the alphabet soup of other terrorist groups in and around the country. ..

Political Stability

Prime Minister Nawaz Sharif is governing with a competent cabinet, a majority coalition, and is working in tandem with the military to deliver peace and security. Sharif was elected in Pakistan’s transition of power between democratically elected governments in April 2013 and so far, he has demonstrated enough of a commitment to democracy.

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Better Luck Around the Corridor

Chinese investment is another reason why the United States should reassess its Pakistan calculus. Since Xi Jinping first announced the $46 billion China-Pakistan Economic Corridor (CPEC) in 2014, the project has quickly become the centerpiece of diplomatic relations between the two countries. CPEC will include highways, railways, and oil and gas pipelines – all constructed via Chinese companies.

A New Development Story

Pakistan has a population of 182.1 million people and is the 6th largest country in the world. Sixty percent of the population is of working age. By 2025, Pakistan’s total population will be 300 million, making it roughly ten times the size of Afghanistan. Pakistan is also among the world’s fastest urbanizing countries with half its people projected to live in cities by 2050. Twenty years ago, Islamabad, a planned city much like Brasilia, had a population of 400,000; today, it has a population of around 3 million including the peri-urban areas. Many Pakistani cities are undergoing a similar urbanization process, and this will create massive demands on food, energy, water, and consumer goods.

Pragmatic decisions by the Pakistani government will change the country’s fate, bring political stability and give a fillip to the economy.

This was said by Daniel F Runde of the Centre for Strategic and International Studies (CSIS) at a seminar organised by National University of Science and Technology (Nust) on Monday. The event was organised by the university’s global think tank network (GTTN) in collaboration with the CSIS, said a press release.

“Pakistan has all necessary ingredients to be the next Colombia or Indonesia,” said the development expert.

Senior fellow at GTTN, Humayun Gauhar, moderated the session titled “The US-led International Developments and Effects on Pakistan and the Region.”

Runde pointed out that Pakistan is a significant South Asian country with massive urbanisation trends and 60 per cent population under 30 years of age, which is a healthy indicator of demographic productivity. The Pakistani diaspora in the US must also be mobilised in order to optimise their presence in the US and strengthen Pakistan’s image as an emerging country, he added.

NUST adviser and GTTN President Amer Hasmi said sustainable economic development was crucial for Pakistan’s rise. He emphasised the need of innovation-based higher learning in Pakistan and explained the university’s contribution through its knowledge ecosystem. He highlighted GTTN’s goals and efforts in furnishing viable policy options for issues of national, regional and global importance.

He apprised the audience that the Nust national science and technology park had won the official candidacy for hosting the 34th International Association of Science Parks’ 2017 World Conference on Innovation in Islamabad. He urged all friends of Pakistan to help the university win the event which has full potential to be a game-changer for the country’s development itinerary.

The CSIS delegation considered China-Pakistan Economic Corridor as a watershed opportunity and a turning point for Pakistan, adding that the American investors are also interested to tap into the Pakistani market.

Some of the Pakistani participants, however, took this optimism with a pinch of salt. There was a view that the issues of accountability, performance and governance should be resolved, if Pakistan was to progress in substantive terms.

The event marked a productive discourse on fall-out of current geopolitics, its implications for Pakistan and the region at large, and a pragmatic approach to manage challenges.

The participants achieved a general consensus of resolving Pakistan’s critical indigenous issues through self-reliance and efficient governance, performance and accountability.

Several former diplomats and bureaucrats, along with academics, researchers and students attended the event.

Energy is a critical element in our lives and positive developments are taking place in energy sector of Pakistan. Four to five years from now, our country will have a significant energy growth as many big projects are in the pipeline, said Syed Asad Ali Shah, former advisor finance, Sindh, on Tuesday.

“One of the greatest achievements of this government is to import LNG through LNG terminals, which have been completed laying down in March this year. LNG import is becoming streamlined. It will very much help redress energy crisis,” he said while speaking as a guest of honor in Conference on Entrepreneurial Engineering Opportunities in Renewable Energy for Self Sufficiency organized by College of Engineering Sciences, Institute of Business Management (IoBM).

He said apart from achievement in LNG sector, oil prices had also crashed which would boost overall production of the country. Shah said integration in energy sector was a much needed. All the companies working in silo should be controlled and monitored by one single body. “It is unfortunate thing that our country has been relying on imported fuel to generate electricity, while, our country is blessed with many resources and one of them is huge reserves of coal. I see positive development in Thar coal as Engro Corporation and Habib Bank Limited will be working on it,” he said.

He said hopefully, sanctions on Iran would be soon lifted and Iran-Pakistan (IP) Gas project would become reality. Prime minister of Pakistan has also discussed energy issue with Turkmenistan in his recent visit. We are generating 100mw electricity from wind corridors, which have the capacity of thousands mega watt. We also have great potential of solar energy if used properly,” he said.

Senior Executive Director Osmani & Co Dr Akhtar said Europe and America had excelled in wind and PV solar energy as renewable energy, while coal, gas and oil are vanishing in those countries. Germany’s single largest energy production is solar and we were not getting benefit of this natural resource despite abundance of it in our country.

He said wind and PV solar energy should be used by choice rather than compulsion. Karachi was going to be dark in the smoke of pollution and electric vehicles were the solution for this.Managing Director Systek (Pvt) Ltd Navid Ansari said energy gap is third world countries like Pakistan could not be overcome in near future. Solar energy could be immediate, affordable and abundant alternative source.

Member (Energy) of the Planning Commission, Ministry ofPlanning, Development & Reforms, Syed Akhtar Ali said pricing on PV solar products should be lowered to promote the product. The government needed to lower duties on local production to make it viable.

Washington :-The IMF on Friday forecast Pakistan’s country’s economy to increase to 4.5 per cent this fiscal, citing macroeconomic stability, low global oil prices, planned improvements in the domestic energy supply and investment related to the China-Pak Economic Corridor.“Pakistan’s economy continues to improve,” said Harald Finger of the Washington DC-based International Monetary Fund (IMF) at the conclusion of the IMF’s country review in Dubai from July 29-August 7.Finger led the IMF delegation while the Pakistani team was led by its Finance Minister Ishaq Dar and State Bank of Pakistan (SBP) Governor Ashraf Wathra.“Real GDP growth is expected to increase to 4.5 per cent this fiscal year, helped by macroeconomic stability, low oil prices, planned improvements in the domestic energy supply, and investment related to the China-Pakistan Economic Corridor,” Finger said.“Inflation dropped to 1.8 per cent in July, but is expected to increase in the coming months with the anticipated stabilisation of commodity prices,” he said.He added that despite declining exports, the external current account deficit narrowed to 0.8 per cent of GDP in the financial year 2014-15 owing to favourable oil prices and strong growth of remittances.Following the country review, IMF and Pakistan reached an agreement on disbursement of another USD 502 million in financial assistance to Pakistan.In a statement, IMF welcomed Pakistan’s plan to continue strengthening public finances and external reserve buffers, and to accelerate efforts to widen the tax net to create space for infrastructure investment and social assistance.In addition, efforts continue to restructure loss-making public enterprises, including through strategic partnerships with the private sector, advance the energy sector reform, improve the business climate, and further expand coverage under Benazir Income Support Programme (BISP) to protect the most vulnerable, Finger said.

Pakistan’s efforts to rein in its budget deficit and build its foreign exchange reserves are paying off, the International Monetary Fund says. In an assessment of the South Asian nation’s economic reform program, the multilateral argues that Pakistan “has significantly reduced near-term risks.”

The IMF praised Pakistan’s progress in implementing social programs and its drive to restructure loss-making public enterprises, to advance energy-sector reform and improve the business climate. It said decisive progress in those areas “will help strengthen competitiveness and resilience of the economy and transform Pakistan into a dynamic emerging-market economy.”

Pakistan is set for continued strong economic growth, the IMF said, forecasting that GDP will increase by 4.5% this fiscal year, which runs from July to June. Growth has been “helped by macroeconomic stability, low oil prices, planned improvements in the domestic energy supply, and investment related to the China-Pakistan Economic Corridor,” the IMF noted.

The country’s inflation rate dropped to 1.8% in July, but is expected to rise in coming months, if commodity prices stabilize, as expected, the IMF said. The organization also noted that Pakistan narrowly missed some budget deficit, tax revenue and government borrowing targets recently.

Foreign exchange reserves at the state bank rose at a healthy pace, the IMF added, reaching $13.5 billion at the end of June.

The country still has a great deal of work ahead of it, though, the IMF explained: “In the period ahead, consolidating these gains and focusing the reform efforts on overcoming structural challenges still facing Pakistan will be important to achieve higher exports, investment, jobs, and growth.”

China has asked Pakistan to establish industrial parks/special economic zones in those areas where provisions of all basic necessities are available such as steel, cement, automobiles, construction materials, household appliances, textile, light industries, garments and others.

Beijing has also conveyed to Islamabad on Monday that they will like to develop Gwadar area as first priority and they will start cooperation from the key projects such as Gwadar Port Free Zone and Haier-Ruba Industrial Park-II, an official presentation titled "CPEC-progress review" reveals, a copy of which is exclusively available with The News.

On China-Pakistan Economic Corridor (CPEC) worth $44.413 billion, Pakistan's military and civilian political leaderships including ruling and opposition parties seem on one page, giving strength to this idea that projects under CPEC would be completed at all costs irrespective of any political divide that may exist in this country.

"At the preliminary stage, we could start from the key projects such as Gwadar Port Free Zone and Haier-Ruba Industrial Park-II," the Chinese side has set the tone for undertaking cooperation under much hyped cooperation between the two countries.

The Chinese side, on proposed industrial parks and special economic zones (SEZs) under CPEC, responded that there was need to conduct industrial and investment cooperation in such areas where provision of steel, cement, automobiles, construction materials, household appliances, textile, light industries, garments and others are available in rampant in order to meet requirements of mass scale industrialisation.

The Chinese further advised Pakistani side to give full play to the Secretariat or the working group on overall planning to explore cooperation on investment and industrial park at the current stage. Beijing viewed that the set-up of new working group could be taken into consideration in due time when the stage would be set for enhancing cooperation between the two sides.

Pakistani side decided to finalise industrial parks/SEZs in consultation with the provinces. The federal government had proposed 29 industrial parks and 21 special economic zones at different sites of the provinces but it would be finalised after taking the federating units into full confidence.

Meanwhile, the CPEC International Forum is being arranged today (Tuesday) at Karamay, Xinjiang China on August 11 and 12, 2015 and Federal Minister for Planning, Development and Reforms Professor Ehsan Iqbal is leading Pakistani delegation.

This conference will be participated by Pakistanis and Chinese authorities, think tanks, local and corporate delegates. It is the goal of the conference to specify principles and goals for implementation of CPEC. This conference is expected to lead towards establishment of permanent international forum.

Both the countries have also decided to initiate and promote China-Pakistan cooperation projects including people-to-people contacts and match- making amongst enterprises, the official presentation concluded.

In Pakistan’s Portion it will start at the point of Khunjrab Top near Pak-China border. It then will travel toward city of Gilgit (Head Quarter of Gilgit Baltistan). After Crossing Chilas and Kohistan it will reach Dasu and Then Besham (District Shangla). Traveling beside Indus River it will reach at Thakot, Where it will goodbye Great Abaseen for some a movement and will entered in Batgram.

After this, CPEC will reach Mansehra and then in Abbottabad (Hazara Region, an Hindko spoken areas). Then it will leave Khyber pakhtunkhwa province for a while and will enter in Punjab province.

At Hassan Abdal (District Attock) it will enter in Punjab. At Hassan Abdal Korakoram Highway and G.T. Road meets. It will the reach Balkasar and then Reach Mianwali.

Again it will cross Indus River near D.I. Khan in KPK Province. Then it will Enter in Balochistan province leaving behind the Khyber Pakhtunkhwa. Its first city in Balochistan will be Zhob and then Qila Saifullah. It will then reach Quetta (Head Quarter of Baluchistan Province).

This historical Road network will then travel through Mastung, Kalat, Surab, Besima, Panjgur and Turbat. The Final destination will be International Sea Port, The Gwadar.

Estimated Length of This Western Alignment (From Khunjrab to Gwadar is 2650 Kilometers.

On August 11 and 12, a forum on the China-Pakistan Economic Corridor (CPEC) convened in Xinjiang, in northwestern China. According to Xinhua, the event was attended by “[m]ore than 300 officials and delegates from companies, think tanks and social organizations” from both China and Pakistan.

Under the CPEC, China and Pakistan plan to build infrastructure to connect Gwadar Port in Pakistan with Kashgar in Xinjiang. The project has become a “flagship project” of China’s Silk Road Economic Belt, although it was proposed in May 2013, a few months earlier than the broader economic belt. As a sign of its important place in the overall strategy, the CPEC was the first project to receive an investment from China’s $40 billion Silk Road Fund, providing partial financing for the $1.65 billion Karot hydropower project in Pakistan. Pakistani President Mamnoon Hussain predicted that the CPEC will be “a monument of the century” during his February 2014 visit to China.

The forum in Xinjiang this week ended with the issuing of the “Karamay Manifesto” on the CPEC, which “praised the significance of the Belt and Road Initiative and 21st Century Maritime Silk Road initiative for the political trust, economic cooperation and cultural exchanges of the countries along the road,” according to Xinhua.

China and Pakistan also signed 20 cooperation agreements, worth $1.6 billion, at the forum. Chinese media did not provide details on the contents of the agreements, although Xinhua mentioned general cooperation in “energy and power projects” and “education and health care.” During Chinese President Xi Jinping’s visit to Pakistan in April of this year, the two sides identified four key areas for cooperation: “Gwadar Port, energy, transport infrastructure and industrial cooperation.”

For Pakistan, the project represents an economic boost and a potential solution to an ongoing energy crisis. According to China Daily, “gas, coal and solar energy projects” — planned under the CPEC framework have the potential to double Pakistan’s current capacity.

For China, meanwhile, the project is a must if the broader Silk Road Economic Belt, with its attendant benefits for China’s domestic economy, geopolitical clout, and regional stability, is to get off the ground. Pakistan, China’s “iron brother,” will likely be Beijing’s most eager partner along the planned Silk Road. China also sees the CPEC in particular as a way to diversify its energy supply, lessening reliance on easily disrupted maritime trade routes.

Other analysts, however, point to the difficulties still facing the CPEC. For one thing, there are lingering security concerns, given unrest and insurgencies in Balochistan, the province where Gwadar is located. There are also domestic arguments in Pakistan over the exact route of the CPEC, which will determine which provinces and cities will reap the windfall of Chinese investment.

German Marshall Fund Transatlantic Fellow Andrew Small remains “cautiously optimistic” about the project. Small, author of the book The China-Pakistan Axis, notes that the security risks in Pakistan haven’t changed, but “the security and economic logic for Beijing is quite different now. With China now motivated partly by efforts to help stabilize Pakistan, and its western periphery more broadly, it’s more willing to live with the attendant security threats.”

Indeed, China and Pakistan seem to be making even more ambitious plans for the CPEC, including links to Iran. Since Iran and the P5+1 negotiating parties reached an agreement to lift economic sanctions in exchange for limits on Tehran’s nuclear program, Iran is once again open for business to the world. Neighboring Pakistan is one of many countries seeking to boost economic ties with Iran – and according to a report in The Express Tribune, many of the Pakistan-Iran links under discussion will be tied to the broader CPEC.

Hashwani to build 5-star hotel in #Gwadar #Pakistan at cost of over Rs 2 billion in Gwadar | Business Recorder. #CPEC http://www.brecorder.com/business-a-economy/189:pakistan/1217405:hashoo-group-invests-over-rs-2-billion-in-gwadar/ …

China Pakistan Economic Corridor will be of immense benefit for both the countries. Gwadar, owing to ideal location of its deep Sea Port, is expected to develop into a regional hub, serving the incoming, outgoing commercial traffic, and also facilitating in transit and intra-transit trade from many countries. Once the connection between Gwadar Port and Kashgar through the Indus and the Karakoram Highway materialises, it will serve Pakistan and China's economic interests as well.

Hashoo Group, realising very early the importance of Gwadar, and keeping the interests of our country at the foremost, the group has invested over Rs 2 billion including construction of 5-star hotel in the region by the name of Zaver Pearl Continental Gwadar to cater to the needs of its customers who are mostly government officials, foreigners, businessmen, bankers, tourists etc.

Located on the cliff-top of the Koh-e-Batil in the beautiful surroundings of Arabian Sea and clear beaches, the hotel has 114 bedrooms equipped with modern facilities, three restaurants offering variety of cuisines, coffee shop, banquet facilities, health club and SPA, 24 hours business centre, and car rental facilities available for both in-house and walk in clients.

Further, given the scenic attraction of Gwadar with its long stretch of golden sunny beaches, it is soon expected to become a tourist resort for tourists. The Makran coastal highway has linked Gwadar with Karachi, which has improved access to the hotel.

Keeping in view the recent increase in economic activity in the area and the promising future prospects of the Gwadar, the Hashoo Group is planning expansion of its existing 5-star hotel initially by adding 40 deluxe rooms by complete phase II of the hotel for which drawings, foundation and piling work is ready. This will not only provide additional accommodation but will also be instrumental in uplifting the economic situation in the region.-PR

In a major step towards the execution of infrastructure projects under the China-Pakistan Economic Corridor, Pakistan on Wednesday approved the awarding of contracts for the construction of two eastern alignment schemes to Chinese firms.

The Economic Coordination Committee (ECC) of the Cabinet decided to grant the contracts for engineering design, procurements and construction to execute the 392-kilometre Multan-Sukkur section of the Lahore-Karachi motorway and the 120km long Thakot-Havelian section of Karakoram Highyway-II (KKH-II).

Since China is providing concessionary loans for both the projects, the contracts will be awarded in government-to-government mode, waiving the condition of international competitive bidding. However, there will still be a competition among Chinese state-owned companies and Beijing has forwarded a set of three names for each of the project.

The ECC, while approving the award of the contracts to Chinese firms, noted that the mechanism for such projects was already covered under article-II of the framework agreement signed by Pakistan and China in April, according to an official handout.

For implementation of the Rs95.4 billion KKH-II Thakot- Havelian section, China has forwarded the names of China Construction Company, China State Construction Engineering Company and China Civil Engineering Construction Corporation, according to National Highway Authority (NHA) officials. The NHA has been mandated to execute these projects and Rs20.5 billion from the current fiscal year’s budget have been allocated for this purpose.

For the Rs259.4 billion Multan-Sukkur section of Lahore-Karachi Motorway, Beijing forwarded the names of China Construction Company, China Civil Engineering Construction Corporation and Syno Hydro Company, said the officials. Rs50 billion have been earmarked for this project in the current fiscal year.

The winning firms will be picked up by end of this month, said the officials. They added the financial agreement with China Export-Import Bank will be signed by October and the firms will be mobilised to commence the construction work in the same month.

The ECC on Wednesday also approved the issuance of sovereign guarantees by the finance ministry in respect of syndicated term finance facility amounting to Rs7.5 billion for the power sector. The amount has been obtained for reducing the circular debt, which jumped to over Rs600 billion including Rs325 billion that the government has parked in a holding company.

The committee, meanwhile, deferred the approval of the automobile policy amid transparency concerns. Finance Minister Ishaq Dar directed the industries ministry to place the policy on its website and accommodate changes recommended by people.

ECC also extended the deadline for export of surplus wheat from Punjab and Sindh to September 30, 2015. It also approved the exemption of 5% sales tax on wheat bran.

#Pakistan's monthly auto sales up 129pc to 15,909 in units in July 2015 https://shar.es/1tTkru via @sharethis

Pakistan local car assemblers have started the new fiscal year with a positive growth of around 129 percent year on year (YoY), according to the data released by Pakistan Automotive Manufacturers Association (PAMA).

During July 2015, the local vehicle sales including LCVs, Vans and Jeeps stood at 15,909 units. It is important to note that in July 2014, sales dropped abnormally due to increase in advance motor vehicle tax and imposition of advance income tax on transfer of motor vehicles in Federal Budget FY15, said Muhammad Tahir Saeed, an analyst at Topline Research.

“Furthermore, anticipated new ‘Corolla’ model and less working hours due to Ramadan were other factors contributing to the historical low sales in last July,” he added.

Overall healthy growth in auto sector is indicative of increase in per capita income, improved farmer economics and overall recovery of the economy. Car financing is also picking up gradually, currently estimated at 30 percent versus 5.0 percent few years ago. To recall, car sales in Pakistan grew at a 5-year (FY11-15) CAGR of 5.3 percent to 179,953 units while volumes surged by 31 percent in FY15 on the back of a new model of Toyota Corolla, Taxi Scheme of Punjab government and an increase in car financing due to 42-year low interest rates in the country.

“We forecast car sales to grow at 13 percent in FY16 to reach at 203,653 units,” the analyst added.

Indus Motors Company (IMC) sold around 4,259 units in Jul 2015 compared to 1,106 units in the same month last year. It is pertinent to note that customers were waiting for the new model of Toyota Corolla in the same month last year which was the main reason for such an abnormally low base. On MoM basis, INDU sales decreased by 22 percent from 5,458 units it sold in Jun 2015.

Saeed attributed this decline to less working hours during Ramadan and extended Eid holidays. Just to highlight, Toyota’s new Corolla model is sold out for next 3-4 months, according to the sources in the industry.

HCAR sold 2,181 units in Jul 2015 compared to 1,505 units in the same month last year. On MoM basis, HCAR sales decreased by 12 percent in Jul 2015 from 2,488 units in Jun 2015.

It is important to note that HCAR is consistently posting sales growth despite the new model of Toyota Corolla launched by its competitor Indus Motors. This indicates that overall market size of Pakistan automobile sector is growing.

Millat Tractors (MTL) and Al Ghazi (AGTL) sales have been affected due to the floods.

MTL sold 743 units in July 2015 compared to 1,703 units in the same month last year. On Month-on-Month basis, MTL sales decreased by 71 percent in July 2015 from 2,556 units in June 2015.

AGTL sold 820 units in Jul 2015 compared to 1,056 units in the same month last year. On Month-on-Month basis, AGTL sales decreased by 40 percent in Jul 2015 from 1,375 units in Jun 2015.

Pakistani prime minister Nawaz Sharif yesterday held a ceremony to mark the start of construction of two Chinese-designed Hualong One units near the coastal city of Karachi.Pakistan has three operating reactors - Karachi 1 (KANUPP) which started up in 1972, and two units at Chashma which have been operating since 2000 and 2011, respectively. Two further units are under construction at Chashma under a long-term cooperation agreement with China.In 2013 ground was broken for the first of the two Chinese-designed ACP1000 units at Karachi, sometimes known as K2 and K3, but this project stalled. The ceremony yesterday relaunched the construction, which is now based on China's successor to the ACP1000, the Hualong One."It is our top priority to end load shedding," Sharif said.Owing to the fact that Pakistan is outside the Nuclear Non-Proliferation Treaty it is largely excluded from trade in nuclear plant or materials, which hinders its development of civil nuclear energy. However, China is positive about nuclear cooperation with Pakistan.Pakistan in 2012 produced 96 terawatt hours of electricity, 35 TWh of this from oil, 27 from natural gas and 30 from hydro. Nuclear power makes a small contribution to total energy production and requirements, supplying only 4.6 TWh - 4.7% of total electricity generated in 2012. Consumption in 2012 was about 77 billion kWh after 16% transmission losses. There was virtually no import or export.Total installed capacity is about 20 GWe, but often only about 12 GWe is operable. In 2005 an Energy Security Plan was adopted by the government, calling for a huge increase in generating capacity to more than 160 GWe by 2030. Significant power shortages are reported, and load shedding - scheduled power-cuts to curb electricity usage - is common.

Through September, working groups of Chinese and Pakistanis will finalise 40-plus projects to launch the $46 billion China-Pakistan Economic Corridor (CPEC). Both governments see this as more than just a construction project. The corridor is designed to transform Pakistan’s economy—and potentially China’s global status.

Already in the Arabian Sea port of Gwadar, the southern terminus of the corridor, the Chinese have begun upgrading the harbour. So has the expansion of the highway out of the port, a road that will run 3000 kilometres to the Chinese border town of Kashgar.

Much of the corridor’s initial expenditure is on power plants. Nearly $34 billion of the corridor’s funds will go to energy projects, with over half of this going to electricity production. When completed, Pakistan’s national grid will receive 10,400 MW additional power.

Beijing’s logic is simple. As an ex-Chinese ambassador to Pakistan explained, “Solving Pakistan’s power deficit is the first step to stabilising its economy.” Pakistan struggles with rolling blackouts thanks to an annual power deficit of about 5,000 MW. The contracts also help Chinese makers of generators, solar cells and the like, all of which suffer from huge overcapacity and need overseas buyers. Pakistan’s Prime Minister Nawaz Sharif, publicly says before his term ends in 2018, power cuts will be a thing of the past.

The CPEC agreement goes far beyond a port, highway and power plants. Gwadar will be all but rebuilt with a hospital, new drinking water supply and an international airport. The agreement spans Chinese biotech for cotton farmers to a multi-million dollar fibre optic network to slots on Pakistani Television for Chinese shows.

While the Karachi-to-Kashgar axis—Gwadar included—receives the most attention, it is only the easternmost of three corridors. Plans exist for central and western alignments—the latter running from Gwadar to Quetta and beyond.

Beijing has made the eastern alignment priority, postponing the central alignment that many Pakistanis prefer. China cites the July 2013 memorandum which says construction would “take the easiest [route] first”.

This has not gone down well with many provinces. Balochistan economic advisor, Kaiser Bengali, complained the present plan would not help economic activity in backward areas. Senator Taj Haider of the Pakistan People’s Party, noting wealthy Punjab would benefit the most, has promised his party would “protest” against “the choice of route” and “the placement of some of the projects”. Under pressure from the military, however, the provinces have grudgingly endorsed the corridor. Balochistan chief minister Abdul Malik Baloch, a strident critic, is among those who have backtracked recently.

China has security concerns about the two other alignments, fed by Pakistani fears that India would somehow sabotage the corridor’s construction.

Pakistani army chief, General Raheel Sharif, last month twice warned “enemies of the state” would try to stop the corridor.

Islamabad plans to train 12,000 security personnel to protect the coming hordes of Chinese workers. This will be in addition to the 8,000 security personnel already deployed to guard existing Chinese workers. Chinese media has already fretted about its workers being abducted. Reports say Chinese and Pakistani intelligence are sharing information on the anti-corridor activities of “foreign hostile agencies”—a reference to India’s Research and Analysis Wing.

Bramdagh Bugti: "If #India wants to help us why should we refuse?" #Pakistan, #Balochistan http://www.bbc.com/news/world-asia-34077864 …

A leading Baloch separatist has said he is ready to consider dialogue with Pakistan, as long as the army ends military operations in the province.Brahamdagh Bugti told BBC Urdu his party could drop calls for independence if "the Baloch people agree".Mr Bugti, who lives in Switzerland, is accused of leading an armed struggle.Balochistan has seen a long-running conflict between security forces and separatists who want a greater share of the province's natural resources.Brahamdagh Bugti, 34, is regarded as one of the most hardline of the Baloch separatist leaders and has until now been opposed to any rapprochement with the Pakistani state which he has vowed to "fight to the death".His remarks are being viewed as an olive branch to the military and could signal the first softening of attitudes within the separatist movement.

AWARAN, Pakistan — The promise of an AK-47, money and a new motorcycle tipped Hammad into militancy at the age of 20.

"I was given three men, a motorbike, a Kalashnikov and 15,000 rupees [$150] per month," the 23-year-old said.

This was a big deal for a middle-school dropout from a region with few jobs and even fewer roads. Hammad learned how to assemble bombs, which added to the thrill of fighting to carve out a separate state for his people, the Baloch.

"My task was easy. To destroy [military and paramilitary] vehicles…Just plant a mine or fire a rocket and zoom off," said Hammad, who asked to be identified by his first name only.

Chief of Army Staff (COAS) General Raheel Sharif on Wednesday inaugurated multiple project in Federally Administrated Tribal Areas (FATA) as part of post military operation rehabilitation plan.

According to Director General Inter-Services Public Relations (ISPR) Major-General Asim Bajwa the army chief inaugurated Cadet College Wana, 132 KV grid station along 54 km long transmission line and a 62 km long road to connect Dera Ismail Khan (DI KHAN) and Tank during his day long visit to South Waziristan.

Speaking on the occasion, General Raheel Sharif said the process of development will continue till complete rehabilitation of tribal region whose people sacrificed to cleans terrorism announcing that every promise made with Temporarily Displaced People (TDP) will be fulfilled.

He said the operation Zarb-e-Azb was in final stages and soon the tribal people will be back in their homes and terrorists shall never return back. He also commended the locals for their sacrifices.

General Raheel Sharif announced that Pakistan army will stay in the region till the mission is completed urging the people of FATA to actively take part in rehabilitation process by army to attain the fruits of military operation and prosperity.

The statement further added these projects will not only improve the quality of life in the areas but also become a source of jobs for locals.

The 62 km long Dera Ismail Khan-Tank Road is part of 705 km long Central Trade Corridor that will be linked to Afghanistan, he said.

For Pakistan, the benefits of CPEC have already started showing. Similar to China, Pakistan’s relationship with United States is deteriorating. The country needs to prosper economically, making it less reliant on the United States. The economic corridor will provide Pakistan with the perfect opportunity to stabilize itself economically while cultivating ties with its neighbors.

The world’s largest explosives manufacturer, Beijing Auxin Chemical Technology Limited, is all set to establish a plant in the country. The company will manufacture emulsion explosives which will “meet the future demand of explosives and blasting accessories in the light of CPEC, large-scale mining and hydroelectric projects.”

On the other hand, energy production being the current core concern of development authorities of Pakistan, is expected take a major leap forward. The Thar Coal Projects have been lined up as priority projects as part of CPEC, which in combination with two other harvest projects will be able to generate up to 2400 megawatts of power by the year 2018.

An agreement for the Lahore Orange Line Metro Project was also concluded earlier this April. According to a web release by Norinco, a pioneer and leader of Chinese military trade, this multi-million dollar deal marks the first urban rail transit project in Pakistan under the “One Belt, One Road” Chinese framework.

Apart from the obvious benefits to Pakistan’s power production, logistics, transportation, communication, and freight handling industries, CPEC will also immensely benefit the country’s real estate running along the trade corridor.

According to Zeeshan Ali Khan, CEO of Zameen.com, “The CPEC’s positive effects on Pakistan’s real estate sector have already started showing. Gwadar, the town at the center of the trade commotion, has started witnessing a heightened demand in anticipation of better times to come as property prices have spiked by more than 200% in just a few months.”

While the real estate sector grows exponentially, Pakistan’s Minister of Commerce Khurram Dastagir Khan also offered the countries making up the Shanghai Cooperation Organisation (SCO) access to Pakistani ports to gain access to seaways from the Arabian Sea when the China-Pakistan Economic Corridor (CPEC) becomes functional.

With all this development going on, the China-Pakistan-Iran trilateral in South Asia is looking up and huge affinities in inter-regional trade could be just around the corner.

Iran’s decision to join CPEC would not only usher in an era of improved standard living across the Sistan-Balochistan region by facilitating trade between Islamabad, Beijing, and Tehran, but also provide a cost-effective gateway to the Gulf region for other Asian countries like Russia and even India.

Russia agreed to build and possibly run a planned natural gas link in Pakistan as President Vladimir Putin seeks to bolster the country’s influence in the Middle East and Asia.The countries signed an intergovernmental agreement for a pipeline that would connect liquefied natural gas terminals in southern Pakistan and its energy-hungry north, with construction to be completed by late 2017, Pakistan’s Petroleum Ministry said in a statement Friday. The line will reach its project capacity by early 2020, Russia’s Energy Ministry said in a separate statement. A unit of Russia’s Rostec State Corp. will manage the project and invite foreign investors, including China, to participate.Putin is seeking allies in Asia and the Middle East in an effort to break out of international isolation caused by the Ukrainian crisis, while Russia’s military build up in Syria has contributed to tensions, especially with the U.S. The deal with Pakistan comes after more than a decade of talks about gas-pipeline projects.“Construction of the North-South pipeline brings trade and economic cooperation of Russia and Pakistan to a new level,” Russian Energy Minister Alexander Novak said in the statement. He and his Pakistani counterpart Shahid Khaqan Abbasi signed the accord in Islamabad in the presence of Prime Minister Nawaz Sharif, according to the statement.Russia is studying funding from Russian and Chinese development banks for the link, the ministry in Moscow said without elaborating. A project company, set up by potential investors, will own and run the 1,100 kilometer (684 mile) pipeline over 25 years, according to the statement.The link would ship as much as 12.4 billion cubic meters of gas per year, which is about 30 percent of Pakistan’s current consumption.

Pakistan and the Asian Development Bank (ADB) on Thursday signed a loan agreement of $178 million for construction of the Gojra-Shorkot section of the M-4 Motorway, aimed at linking the southern parts of the country with the northern belt.

The United Kingdom will also fund road construction and would provide $90.7 million as a grant. The UK will disburse funds through the ADB. The government will invest the counterpart share of $46 million, bringing the total cost of the project to $315 million.

The M-4 Motorway will have four sections. The Faisalabad-Gojra’s 58-kilometre section has been opened for traffic. The project was completed by obtaining a loan of $170 million from the ADB. However, a dispute between the contractor and the NHA remains unresolved.

The Gojra-Shorkot section of 62km will be completed by 2019. The rest of the sections are Shorkot-Din Pur-Khanewal (64km) and Khanewal-Multan (45km).

Once the M-4 is completed, it will link the southern parts of Punjab with the north through already established networks of motorways. The M-4 Motorway will extend the already completed M-1, M-2 and M-3 motorways southward and shorten the distance between Multan and the twin cities of Islamabad-Rawalpindi.

Upon completion, the M-4 Motorway will provide a four-lane access controlled alternative to the existing narrow and congested routes notably in the heavily trafficked Faisalabad and Khanewal-Multan-Muzffargrah areas.

It is the second project that is being co-financed by the UK government. Britain is already a participant of the China-Pakistan Economic Corridor and provided $121.6 million in grant to fund construction of the Burhan-Havelian Expressway, which falls on the northern route.

The ADB said the new investment will boost the flow of trade and travel while reducing transportation cost and time from Pakistan’s textile producing hub Faisalabad towards Multan, which is the major trade centre in southern Punjab.

The ADB and UK’s Department for International Development (DFID) have joined hands to assist Pakistan in improving the country’s vital north-south road network to promote economic growth, job creation and regional connectivity, according to an official handout issued by the local office of the Manila-based lending agency.

Acting head of the UK’s DFID Judith Herberston said UK’s partnership with ADB and the government of Pakistan will help improve road safety and enhance local and regional trade.

The M-4 is also a step towards positioning Pakistan to act as a transit artery for goods moving between the port city of Karachi in the south to Torkham on the northern border with Afghanistan through the country’s major business and population centres.

The 1,800-km route will also eventually link Pakistan’s ports with the land-locked regions of Central Asia, and will allow Pakistan to reap dividends of its active membership in the Central Asia Regional Economic Cooperation (CAREC) Programme, said the ADB.

The EAD secretary thanked ADB and DIFD for providing vital support to Pakistan, particularly for efficiency gain from road traffic operation along the National Transport Corridor. He assured Pakistan’s commitment to mobilise all-out efforts and scale up practices for improving and developing inter-provincial linkages to improve local connectivity.

Now that the initial euphoria of ‘higher than the Himalayas and deeper than the deepest sea’ is over, the $45bn China-Pakistan Economic Corridor is beginning to hit the ground realities.

As is expected of such a major initiative, some teething problems are coming to light, requiring a lot of legal and procedural clarifications and adjustments. Most of these seem to be exposing the general lack of preparedness and casual handling of projects that has be­come the hallmark of our bureaucratic culture.

Also read: CPEC to benefit entire region, say analysts

This has resulted in repeated project delays, cost overruns and unquantifiable lost economic opportunities. Cost rationalisation, according to Planning Minister Ahsan Iqbal, had alone created a Rs490bn cushion in the last fiscal year.

Pakistan has been struggling to convince Chinese authorities to accept around a 10pc cost overrun for the $1.5bn Lahore Orange Line Metro Train even though the project has yet to take offWhile dealing with external players, such lethargy and poor project handling can have exponential costs. Pakistan has been paying substantial commitment charges without utilising loans from development lenders every year and this has to be taken care of on an urgent basis.

Following the 6,600MW Gadani Power Park debacle arising out of a half-baked plan, the two sides seem to have learnt the lesson to take up ‘early harvest’ projects that are ready to take off immediately and could be expected to deliver results before the PML-N goes into the next polls with a success story on having reduced the power shortfall.

Focal persons are now being appointed in all the ministries and agencies concerned with the CPEC to expeditiously process any hitches and glitches.

Meanwhile, a mega coal-based project previously being pushed for Sahiwal is reported to have faced financing problems because of the infrastructure requi­red for transporting coal. It has now been replaced, at least on paper, with two sma­ller coal power projects at Thar and Hub to compensate for Sahiwal’s lost capacity.

Pakistan has recently been struggling to convince Chinese authorities to acc­ept around a 10pc cost overrun for the $1.5bn Lahore Orange Line Metro Train even though the project has yet to take off.

The Chinese Exim Bank was insisting on a loan agreement of $1.48bn to be signed with the Punjab government as originally discussed, but Pakistani authorities want this to be increased by another $147m to meet contingencies that arise during the project’s implementation.

The local authorities have to be blamed for originally negotiating the project for $1.48bn with the Chinese before getting the cost escalated to $1.63bn through the Executive Committee of the National Council. Unless an arrangement for the ‘additional requirement’ is made, the project cannot achieve financial close. The financing cost of the 27km Rs165.2bn project is also reported to be on the higher side despite it being in the ‘concessional category’.

On top of these, the Chinese have sought tax exemptions on insurance and financing on almost all CPEC projects.

At the heart of the problem is the IMF’s condition under which the government has withdrawn the powers of the taxation authorities to grant exemptions through statutory regulatory orders.

At present, no tax exemption is permissible on insurance premiums paid to non-resident companies because only a low rate of 5pc is applicable, while all CPEC projects are mostly covered by the state-owned Chinese firm Sinosure. The Chinese authorities want the insurance premiums paid to Sinosure to be exempted from the income tax

On a visit to Pakistan in April, President Xi announced $46bn in investments and credit lines in a planned China-Pakistan economic corridor. Earlier this year, one of China’s largest construction companies signed construction deals in Africa worth a combined $5.5bn. Both are OBOR projects, providing a platform for the cash-rich Chinese to invest, as well as the opportunity to lift growth across the world.As these countries benefit economically from the infrastructure investment, Britain should be poised to take advantage. The British government has already indicated its support for the Asia Infrastructure Investment Bank. British banks like Standard Chartered, which has had a continuous presence in China since 1858, are well placed to assist with the financing of OBOR.It is not only financial services, but a range of British business that should invest in OBOR, harnessing our expertise in PPP, engineering and supply chains.For example, last week’s agreement signed by Standard Chartered and other banks with the London Metals Exchange reflects the increasing demand for commodities from OBOR projects.The opportunities to invest in and support these infrastructure projects will be exciting.We should endeavour to ensure British business is welcomed in these markets, ready to support them and trade with them as they establish themselves in the new world order. British luxury brand Burberry, for example, has been investing across south-east Asia, most recently opening a new store in Bangkok. It’s a long-term investment, just as China is investing in OBOR for long-term prosperity.

Federal Minister for Planning and Development, Prof. Ahsan Iqbal on Thursday said social and economic activities have started in Balochistan along with the roads being constructed there as part of China Pakistan Economic Corridor (CPEC).Under CPEC, two international standard roads are being constructed-- from Gwadar to Quetta, and from Gwadar to Khuzdar to Ratodero, he said." I was pleased to see, the local people have started setting up hotels, shops and houses along the completed portions of the CPEC routes linking Gwadar with China. This corridor shall bring social and economic change in Balochistan," he expressed his satisfaction while addressing a seminar on CPEC here.The seminar titled " China Pakistan Economic Corridor: A Road to Peace and Prosperity of the Region" was organised by an NGO , Rabita Forum International (RFI) and presided over by its Chairman RFI, Nusrat Mirza. It was attended by a large number of students from different universities and the teachers.RFI Chairman , Nusrat Mirza said the seminar was organised to create awareness among the students about the importance and prospects of CPEC, and what the role they could play in transforming CPEC into a big success for the country.The universities would have to prepare groups of professionals to meet the demands of the projects/activities emerging during and after execution of this very important international plan of CPEC, Nusrat Mirza said.The Federal Minister for Planning and Development assured that CPEC would be equally beneficial for all the provinces. Like Gwadar, he continued, Gilgit-Baltistan would be gateway to CPEC.46 billion dollars CPEC would prove a game changer for entire region. It would interlink South Asia, Central Asia and Europe , and open billions of dollars market for Pakistan and other regional countries, he said. He elaborated that CPEC plan is divided into four parts : 1) setting up the most modern port of Gwadar which would increase our trade manifold, 2) strengthening of energy sector by adding more than 10,400 MW to the system and upgradation of the transmission system, 3) development of infrastructure based on three routes linking China with all the provinces of Pakistan, 4) industrialization mainly in Gwadar under Pak-China partnership and cooperation.

Beijing also wants to reach Central Asia through the CPEC. As Afghanistan is not willing, China and Pakistan are working on an alternative route – the Quadrilateral Agreement on Traffic in Transit. This route will deprive Afghanistan of an opportunity to cash in on the benefits that will emerge from the CPEC.

Before the agreement on the $46-billion CPEC, Pakistan gave control of Gwadar Port to a Chinese company for developing and running the facility. China also plans to establish an oil refinery at the port.

Tajikistan, which is seeking oil imports from Kuwait via Pakistan, has been offered access to the port. Tajikistan may also have the facility to bring goods from Middle Eastern states and other countries.

Tajikistan is the only country among Central Asian states which is keen to give road and energy access to Pakistan. This can make Pakistan a trade hub as it will provide access to other Central Asian nations as well.

In such a scenario, Balochistan will win a substantial share in economic development and will be able to stave off negative consequences of the insurgency. Economic prosperity will overcome the threat of terrorism and ensure stability in the entire country.

The M8 is being constructed by Pakistan's National Highway Authority. Construction of the M8 commenced on 15 October 2004.[1] According to a newspaper report of July 23, 2015 the construction arm of Pakistan army, Frontier Works Organization (FWO) has completed 502 of 870 kilometer of this road.[2] The work started simultaneously from the junction with the Mekran Coastal Highway (MCH) and from Ratodero in Sind. As of January 2015 the road is completed except for some bridges from MCH to a point near Hoshab where it joins N85 (Hoshab-Panjgur-Besima Highway) and Hoshab-Bela Road. The M8 Motorway will be following the alignment of N85 but no noticeable construction has been completed on this section. From the Ratodero end M8 to Khuzdar is almost complete except for a difficult section going over the peaks of northern Kirthar range about seventy Kilometers east of Khuzdar.

ZOHB (Dunya News) – Prime Minister (PM) Nawaz Sharif on Wednesday has said that the government would spend Rs 200 billion for construction of roads in Balochistan.

The Prime Minister addressed a gathering at the foundation stone laying cereomy of the western route of the Chine-Pakistan Economic Corridor (CPEC).

The premier said that Pakistan’s progress would begin from Balochistan.

PM Nawaz said that Gwadar-Karachi coastal highway would be made a state-of-the-art motorway. He thanked the political parties for support of the CPEC. The PM said that several projects would complete by end of 2017.

A 243 Kilometre (Km) long road would be completed by April 2016 while the funding would be drawn from the development package, he added.

The Prime Minister said that around Rs 150 billion to Rs 200 billion would be spent in the coming three to four years on construction of roads. Feasibility reports of projects in Mach, Kharan and other areas are being prepared to initiate construction as soon as possible, he added.

Nawaz Sharif said that Gwadar port would be made one of the best ports in the coming years.

The Prime Minister said that construction of Gwadar-Hoshab road would be completed in January 2016, he added. The Gwadar-Hoshab road is 194 Km long.

ZHOB: Prime Minister Nawaz Sharif Wednesday said a hefty amount of Rs.150 billion to Rs.200 billion would be spent in the next three to four years in Balochistan for alleviating its backwardness.

The PM also announced his plan to build Karachi-Gwadar motorway while addressing a ceremony after performing groundbreaking of upgradation of Zhob-Mughal Kot (N-50) and Qila Saifullah-Wagum (N-70) roads.

Also read: PM performs groundbreaking of CPEC western route

The 81-kilometer N-50 project, a part of CPEC, to be completed at the cost of Rs 8.80 billion by 2018. The 126-kilometer N-70 project will cost Rs 7.50 billion and it would also be completed by 2018.

He said there was no precedent in the history of Balochistan that construction work on massive roads network continued on such fast track basis.

He said as part of China Pakistan Economic Corridor, 194 kms road from Gwadar to Khushab would be inaugurated next month whereas Khushab- Panjgur -Basima 454kms road be completed by December 2016 by the Frontier Works Organization (FWO).

Khuzdar-Wanguhil-Shahdad Kot, 243kms road would also be completed by the next year, he announced, adding all these projects were being funded by the government of Pakistan out of its Public Sector Development Programmes (PSDP).

He praised the Director General FWO Maj. Gen. Muhammad Afzal and NHA chairman Shahid Ashraf Tarrar for their hard work and commitment.

The Prime Minister also referred to Kalat-Quetta-Chaman and Kharan phase-1 roads which would be completed in the next year while feasibility work on Zhob-Jandola road was being done.

He said uplift of the province was the top priority of his government as it would benefit the entire country.

"The project would open up opportunities of trade and business for the whole region and help in removing backwardness of the province. Soon, there will be dawn of prosperity of which Balochistan would be the major source of fast track progress, "he added.

One Belt, One Road: #Chinese companies look west for growth- Nikkei Asian Review #CPEC #China #Pakistan http://s.nikkei.com/1RUmRbx Kashgar, where Shandong Ruyi Science & Technology Group has chosen to build a new textile mill, lies on China's western reaches, about 300km from the border with Pakistan. But the unforgiving desert environment does not detract from the place's appeal to Chairman Qiu Yafu.

"From here, we will open a path to the vast markets of India, Pakistan and Central Asia," said Qiu, whose company owns Japanese apparel maker Renown.

This is not the only Chinese company going west. Scisky, a maker of water-based paint that counts itself among Ikea's suppliers, moved its headquarters from the city of Hefei near coastal Shanghai to Lanzhou in inland Gansu Province in 2014.

Lanzhou marked an important stop along the old Silk Road. The impetus for Chinese businesses' westward movement today comes partly from President Xi Jinping's vision of a new era of connectivity on the Eurasian landmass.

The slogan for this -- "One Belt, One Road" -- was introduced in 2013. But the idea builds on existing links. A railway already runs from China to Europe through Kazakhstan, and highway stretches from Kashgar into Pakistan. The Chinese-led Asian Infrastructure Investment Bank, which holds its opening ceremony Saturday, could help boost economic growth along these corridors. Chinese companies see market share to be had there.

Some are already satisfying infrastructure-related demand. Heavy equipment builder Zoomlion shipped 30-odd machines for road construction to Kyrgyzstan late last year. Domestic rival Sany Heavy Industry is hurrying to position itself in Turkey, India and other places where huge earthmoving projects are underway or in the works.

Lands of opportunity

Countries along the new Silk Road hold the promise of market growth. Tajikistan's population of 8.48 million is projected by the United Nations to swell to 14 million in 2050, while that of hydrocarbon-rich Kazakhstan, home to a burgeoning middle class, is seen rising 30%.

Gansu Province-based Lanzhou Lanshi Group, a maker of oil production and refining equipment, plans to open sales offices in India, Turkmenistan and four other countries by the first half. It aims to raise the proportion of foreign revenue from less than a tenth to more than half.

China's trade with Pakistan and four other neighbors to the west surged in the past decade, topping $50 billion in 2013 -- about 15% the size of its trade with Japan. Although 2014 brought a decline as commodity prices slumped, westward trade will likely rebound as connectivity projects move from the drawing board to reality.

This will mean more opportunities for payment in yuan. Beijing aims to create an expansive commercial sphere where the redback, and not the greenback, serves as the principal currency. The AIIB fits into its strategy of undermining the U.S.-centered, dollar-dominated global financial order that arose after World War II.

The power of the yuan is growing visibly in the region. Soon after China devalued the currency by 2% last August, Kazakhstan allowed the tenge to float, in effect responding with its own deep devaluation.

The primary concern of the smaller provinces as reflected in the resolution of the K-P assembly that the western alignment is not on the priority list of the centre. This claim is wildly being repeated without any evidence to back it up. In fact, the work is underway on the western and eastern routes simultaneously. The Frontier Works Organisation is working to complete the missing 400km link between Gwadar and Surab passing through Quetta, Zhob, Dera Ismail Khan and Peshawar.

In order to make Gwadar operational in the shortest possible time, the eastern alignment linking Karakoram Highway to existing motorways is the best bet. Given high traffic volume, thriving industries and security on the eastern route, it is much more feasible to kick-start the project. With work in progress on the central, western and eastern alignments simultaneously – linking Gwadar, Pakistan to Kashgar, China within 15 years under the CPEC – there is no reason to make the whole project controversial by mere speculations.

Is motorway prerequisite for the corridor?

Some in the provinces are demanding Zhob-Mughal Kot (N-50) or Qila Saifullah-Wagum (N-70) on the western route be constructed six lanes on the pattern of Karachi-Lahore Motorway. It makes no sense because of negligible traffic at the moment on the route. Of course, this route would have to be expanded with the passage of time as the traffic volume increases with the economic activity along the corridor. Without going into the technical nitty-gritty, it suffices to say that the same size lane is being constructed across the border on Chinese side. So, motorway is not needed at this time on the western route.

Economic zones: K-P on top

Another major concern of the smaller provinces is the alleged shifting of the industrial parks along the original western route to the eastern route thus denying the dividends of the project to the people of K-P and Balochistan. Some fact checking reveals that Board of Investment (BoI) has identified 27 economic zones out of which eight fall in K-P. The committee of BoI tasked to identify the potential sites for economic zones has worked in consultation with the provinces. However, it’s subject to approval by the joint working groups of China and Pakistan.

CPEC energy goes into national grid

Some have questioned the criteria for the allocation of the energy projects to the provinces. As a matter of fact, the energy generated by the projects under CPEC would be added to the national grid for nationwide distribution regardless of its installation point. So, the location of the power plant does not really matter. Most of the energy projects are located either close to the source or the load centre.

Contrary to all the noise, benefits to the largest province Balochistan are also enormous. Once developed, Gwadar would serve as a game-changer not only for the country but also for the entire region. Preliminarily, seven industrial parks have been marked in the province, making it the second highest number after K-P. It would open new jobs for the locals, uplifting them from extreme destitution.

Who gets the lion’s share?

Here arises a question: who will benefit the most from the CPEC once executed as envisioned by its authors? It will benefit the whole of Pakistan given the presence of various projects under CPEC spread across the length and breadth of the country. All the provinces stand to benefit from the project as all the provincial capitals – including Lahore, Karachi, Peshawar and Quetta – would be the major nodes of the project.

Prime Minister Nawaz Sharif on Wednesday inaugurated the Gwadar-Hoshab (M-8) road and reviewed the work being carried out on the China-Pakistan Economic Corridor (CPEC).

During the inspection of the newly constructed M-8 route, General Raheel Sharif personally drove the prime minister in an open-top vehicle.

The military spokesperson also added that the locals were overjoyed with the progress of the CPEC project.

“The land-locked Central Asian states are interested in trade via the Gwadar port,” said the prime minister.

He said on the occasion that CPEC would open new vistas of development and prosperity in the region in general and benefit the country in particular.

The inauguration ceremony of M8 was attended by Chief Minister Balochistan Nawab Sanaullah Zehri, Chief of Army Staff General Raheel Sharif, Commander Southern Command Lieutenant General Amir Riaz and other high ranking military and civilian officials.

The prime minister on the occasion also praised the services and sacrifices rendered by the Frontier Works Organisation (FWO) in the construction of CPEC.

“Despite security problems, work is in full-swing on construction of roads in Balochistan,” added Nawaz.

The Prime Minister elaborated that after completion of CPEC and other related projects, Balochistan would not be dependent for financial aid on the federal government. "CPEC would ensure economic development of Balochistan", he said, adding that the people of the province would be major beneficiaries of the mega project.

-"Projects cannot be completed through mere slogans, rather a strategy was imperative for completion of projects", he said.

The prime minister also reiterated his commitment on the occasion and said efforts were being made to develop Balochistan and bring it at par with other parts of the country.

Read: PM inaugurates western route of CPEC in Zhob

Earlier in January, Prime Minister Nawaz Sharif had inaugurated the western route of the (CPEC) in Balochistan's Zhob and laid the foundation stones of two key projects: upgradation of the Zhob-Mughal Kot section of the Dera Ismail Khan-Qila Saifullah Highway (N-50) and the Qilla Saifullah-Waigam Rud Road section of the Multan-Dera Ghazi Khan-Qilla Saifullah Highway (N-70)

Proposed by Chinese Premier Li Keqiang during his visit to Pakistan in May 2013, the CPEC will act as a bridge for the new Maritime Silk Route that envisages linking three billion people in Asia, Africa and Europe.

An official agreement on the corridor was signed between the two countries in May this year during President Xi Jinping's historic visit to Pakistan.

A flagship project of the Belt and Road initiative as well, the CPEC intends to revive the ancient Silk Road with a focus on infrastructure, and constitutes the strategic framework of bilateral cooperation.

The project links China's strategy to develop its western region with Pakistan's focus on boosting its economy, including the infrastructure construction of Gwadar Port, together with some energy cooperation and investment programs.

It also involves road and railway construction including an upgrade of the 1,300-km Karakoram Highway, the highest paved international road in the world which connects China and Pakistan across the Karakoram mountains.

The CPEC will reduce China's routes of oil and gas imports from Africa and the Middle East by thousands of kilometers, making Gwadar a potentially vital link in China's supply chain.

The inauguration ceremony of M8 was attended by Balochistan Chief Minister Nawab Sanaullah Zehri, General Raheel Sharif, Commander Southern Command Lt Gen Amir Riaz and other high ranking military and civilian officials.

The prime minister on the occasion also praised the services and sacrifices rendered by the Frontier Works Organisation (FWO) in the construction of CPEC.

“Despite security problems, work is in full-swing on construction of roads in Balochistan,” added Nawaz.

Prime Minister Nawaz elaborated that after completion of CPEC and other related projects, Balochistan would not be dependent for financial aid on the federal government.

“CPEC would ensure economic development of Balochistan,” he said, adding that the people of the province would be major beneficiaries of the mega project.

“Projects cannot be completed through mere slogans, rather a strategy was imperative for completion of projects,” he said.

The prime minister also reiterated his commitment on the occasion and said efforts were being made to develop Balochistan and bring it at par with other parts of the country.

ARMY CHIEF INSPECTS PROJECTS:

Meanwhile, Gen Raheel visited Hoshab area in Southern Balochistan to inspect new roads being built by army engineers as part of the China Pakistan Economic Corridor (CPEC).

According to DG ISPR Lt Gen Asim Saleem Bajwa, Gen Raheel lauded the pace and quality of work done by the Frontier Works Organisation (FWO).

In Pasni, the COAS held a meeting with Balochistan governor, chief minister and chief secretary.

The total road being built by the FWO for CPEC is 870kms long, out of which, 632kms have been completed within the last one and a half years.

Earlier in January, Prime Minister Nawaz Sharif had inaugurated the western route of the (CPEC) in Balochistan’s Zhob and laid the foundation stones of two key projects – upgradation of the Zhob-Mughal Kot section of the Dera Ismail Khan-Qila Saifullah Highway (N-50) and the Qilla Saifullah-Waigam Rud Road section of the Multan-Dera Ghazi Khan-Qilla Saifullah Highway (N-70).

The CPEC is a 3,000-kilometer network of roads, railways and pipelines to transport oil and gas from Gwadar Port to Kashgar city, northwestern China’s Xinjiang Uygur autonomous region.

A year or so before Ajit Doval became national security adviser, he famously warned Pakistan that a repeat of the Mumbai 26/11attack could lead to Pakistan losing Balochistan. The Doval Doctrine – as it has now come to be known – involves what he calls a “defensive-offensive” strategy where India’s security establishment acquires a sub-conventional secondstrike capability, to be wielded as and when needed.The Pakistan military establishment is aware that Balochistan is a natural weakness India could exploit with telling impact. In May last year, the Pakistan army’s media machinery all but accused India of fermenting secessionism there.But here lies the twist. China – as part of the China-Pakistan Economic Corridor (CPEC) – sees the Balochistan port of Gwadar as an integral part of its One Belt, One Road (OBOR) initiative. Indeed, as former foreign secretary Shyam Saran recently wrote, Gwadar is significant precisely because it is where China’s Maritime Silk Route (“the Road”) meets its Eurasian landbased connectivity project (“the Belt”).The geopolitical significance of Gwadar to China makes any Indian subconventional response in Balochistan exceedingly complicated. The reality is that the same Balochi rebels who want to secede from Pakistan have also opposed Chinese activities.This was evident last March when Balochi rebels set fire to five oil tankers servicing a Chinese company. However, it is likely that unrest in that region, organic or manipulated, that hurts Chinese interests could be viewed by Beijing (or could be sold to them), as Indian provocation.It is also inconceivable that China would sit idle if the separatists, allegedly backed by India, move from being a mere nuisance and acquire the potential to seriously jeopardise their prize – Gwadar – of the $46 billion CPEC investment. China could initiate and enhance its support for militants in the Indian northeast, or worse, encourage and abet Pakistan’s proxy warriors.Meanwhile, an assertive US AsiaPacific re-balance in the region – in response to China’s naval activism in the South China Sea – is likely to ensure greater US control of the Malacca Strait in order to deter the Chinese from revising marine territorial borders.China, therefore, seeks alternative routes for its energy supply and goods, which would connect the Strait of Hormuz to a port in the Arabian Sea, along with better land connectivity through the Eurasian landmass.Even as these new realities reshape multiple arrangements in the region, the challenge for India is to ensure that Balochistan does not transform from being Pakistan’s quagmire to another thorn in the Sino-Indian relationship. India must wean China away from the Gwadar port, and CPEC in general, by offering credible alternatives.India could fast track its commitment to the Bangladesh-China-India-Myanmar (BCIM) corridor and invite the Chinese to set up a land connectivity corridor from Kolkata to Gandhinagar, passing through Mumbai. It should also offer to partner with the Chinese to refurbish the NH-6 linking Kolkata to Mumbai.Finally, it should get the Chinese on-board the Sagarmala initiative, and allow the Chinese to co-develop a port off the coast of Gujarat, which would link up with the Indian-Chinese land connectivity corridor running roughly parallel to the Tropic of Cancer. The financial model for this land initiative could be along the lines of what has been proposed for the Delhi-Mumbai Industrial Corridor in collaboration with Japan, and implemented through the China-led Asian Infrastructure Investment Bank in which India is the second-largest shareholder.

I think Pakistan currently has the upper hand in both corridor diplomacy and proxy wars in the region, particularly since 2014 when Pakistan Army started acting forcefully against India's proxies, the TTP and the Baloch insurgents.

I expect India to continue to counter Pakistan in both more forcefully as CPEC nears reality.

Chief of Army Staff General Raheel Sharif on Friday said that security forces are ready to pay any price to turn the China Pakistan Economic Corridor (CPEC) dream into reality.

“We are aware of all the campaigns against CPEC,” said the army chief.

During his visit to the headquarters of the newly raised Special Security Division (SSD), responsible for the security of CPEC projects, the army chief instructed the force to take all possible measures to make all CPEC related projects a success.

COAS was given a detailed briefing over raising of the force and the security threats faced by the CPEC project.

Gen Raheel Sharif reiterated the army’s commitment to provide security for CPEC and the work force involved in the projects, terming the plan a game changer for Pakistan and its people.

On arrival, COAS was received by Lieutenant General Malik Zafar Iqbal and Major General Abid Rafique, Commander SSD.

The CPEC is a 3,000-kilometer network of roads, railways and pipelines to transport oil and gas from Gwadar Port to Kashgar city, northwestern China’s Xinjiang Uygur autonomous region.

Proposed by Chinese Premier Li Keqiang during his visit to Pakistan in May 2013, the CPEC will act as a bridge for the new Maritime Silk Route that envisages linking three billion people in Asia, Africa and Europe.

An official agreement on the corridor was signed between the two countries last year during President Xi Jinping’s historic visit to Pakistan.

The project links China’s strategy to develop its western region with Pakistan’s focus on boosting its economy, including the infrastructure construction of Gwadar Port, together with some energy cooperation and investment programs.

It also involves road and railway construction including an upgrade of the 1,300-km Karakoram Highway, the highest paved international road in the world which connects China and Pakistan across the Karakoram mountains.

The CPEC will reduce China’s routes of oil and gas imports from Africa and the Middle East by thousands of kilometers, making Gwadar a potentially vital link in China’s supply chain.

Pakistan has reason to believe that the Indian spy agency, Research and Analysis Wing (RAW), has established yet another desk with a special allocation of a huge sum of money to scuttle CPEC.

According to reports in the local media, RAW, created in the wake of the 1965 war between Pakistan and India, has been assigned the gigantic assignment to ruin the trade corridor project, the biggest operation after the creation of Bangladesh tasked to it immediately after its creation way back in September 1968.

Pakistan’s intelligence gathering agencies had collected authentic evidence and proof about the designs of RAW that has already initiated its work. RAW is known for sponsoring terror activities for attaining its objectives. It is engaged in promoting and aiding disruptive elements in Pakistan to destabilise the country.

The budget of RAW isn’t known to anyone but $300 million have been earmarked initially for subverting the economic corridor.

Pakistan on Tuesday released a video in which an arrested Indian spy is heard confessing New Delhi's alleged involvement in terrorist activities in Balochistan.

Kulbushan Yadav says in the video that he had been directing various activities in Karachi and Balochistan "at the behest of RAW", the Indian intelligence agency, and that he was still with the Indian Navy.

Yadav added that he had played a role in the deteriorating law and order situation in Karachi, Dawn reported.

The video was released at a press conference attended by Pakistan Army spokesman Lt Gen Asim Bajwa and Information Minister Pervez Rashid.

Terming Yadav's arrest a "big achievement", Bajwa said Yadav was directly handled by the RAW chief and Indian National Security Adviser Ajit Doval.

"His goal was to disrupt development of the China-Pakistan Economic Corridor (CPEC), with Gwadar port as a special target," Bajwa said.

"This is nothing short of state-sponsored terrorism... There can be no clearer evidence of Indian interference in Pakistan."

Yadav is heard saying in the video that he was still a serving officer in the Indian Navy and would be due for retirement in 2022.

"By 2002, I commenced intelligence operations. In 2003, I established a small business in Chabahar in Iran.

"As I was able to achieve undetected existence and visits to Karachi in 2003 and 2004. Having done some basic assignments within India for RAW, I was picked up by RAW in 2013 end," Yadav said.

He said his purpose was to meet Baloch insurgents and carry out "activities with their collaboration".

Law enforcement agencies arrested Yadav in an intelligence-based raid in Balochistan's Chaman near the border with Afghanistan last week. He held a valid Indian visa.

India denied Yadav was an intelligence operative and said he was formerly from the navy. New Delhi also demanded consular access to Yadav, which has been denied.

Yadav was shifted to Islamabad for interrogation, during which an unnamed official said the spy revealed he had bought boats at the Iranian port in Chabahar in order to target Karachi and Gwadar ports, Dawn reported.

Since 2013, India's current National Security Advisor Ajit Doval has been talking about "Pakistan's vulnerabilities" to terrorism and India's ability to take advantage of it. The latest arrest of Indian agent Kulbhushan Yadav is confirmation of the Doval Doctrine against Pakistan in action.

“The (#Gwadar) port will be in full operation by end of this year (2016)” Zhang Baozhong. #China #Pakistan #CPEChttp://www.voanews.com/content/china-pakistan-ready-new-cargo-port/3285375.html

Gwadar, jointly developed by Chinese and Pakistani engineers, lies at the convergence of three of the most commercially important regions of the world, the oil-rich Middle East, Central Asia, and South Asia.

“The port will be in full operation by end of this year,” said Zhang Baozhong, chairman of China Overseas Ports Holding Company Ltd., who is in charge of development and operation at Gwadar.

The deep water shipping port, built with Chinese financial and technical assistance, is central to the recently launched grand cooperation agreement between the two close allies.

Trading zone expected in the future

The so-called China-Pakistan Economic Corridor, known as CPEC, is a package of building railroads, highways, pipelines, power plants and industrial zones with an investment of $46 billion. It will also give Beijing greater access through Pakistan to global markets, including Africa and Europe.

​Baozhong told a conference of officials, politicians and foreign diplomats in Gwadar, that almost no trading activity is taking place at Gwadar right now but that is expected in a year.

“We are expecting that roughly one million tons of material will go in and out,” he said.

Initially, most of the cargo will be construction material worth billions of dollars for ongoing and proposed projects such as building roads, schools, hospitals, a free trade zone at the port, and the city’s international airport, which is expected to be started by the end of this year, explained Baozhong.

Gwadar is located in Baluchistan province where separatist groups have, for decades, waged guerrilla attacks against key government facilities, officials and security forces.

Security measures

Pakistani authorities in recent months have stepped up what they say are targeted operations against the insurgents and have also raised a special force within the past year for the protection of CPEC-related projects in and beyond the province.

“I assure you that security of CPEC is our national undertaking and we will not leave any stone unturned. We will continue to keep a close watch at its every step.To this effect, a 15,000-strong, dedicated force is already in place under the ambit of Special Security Division,” said the Pakistan military chief, General Raheel Sharif, while addressing the conference in Gwadar.

Chinese officials also said that Pakistan’s counter-militancy efforts have addressed safety concerns to “a great extent” and sped up on all the projects in the last year.

“The improved environment in Pakistan has created favorable conditions for the China-Pakistan Economic Corridor.A remarkable progress has been made in CPEC projects,” said acting Chinese Ambassador to Pakistan Zhao Lijian, in his speech to the conference.

Chinese operators of Gwadar's port say they are also developing a mechanism to improve quantity and quality of the local fishing industry to help boost the region’s economy.

A 923-hectare free trade zone outside the port, expected to be in place by the end of next year, will have a large processing plant, a large refrigeration house, and other facilities to improve seafood exports, said Baozhong.

BY KADAYAM SUBRAMANIAN on MAY 12, 2016 in ASIA TIMES NEWS & FEATURES, CHINA, INDIA, SOUTH ASIA

Ajit Kumar Doval, National Security Advisor to Prime Minister Narendra Modi, is the second most important official in the government of India. His close ties with Prime Minister Modi reminds one of BN Mullik who, like him, was IB chief (1950-64), had close relationship with then prime minister Jawaharlal Nehru and influenced his key decisions on Kashmir, Pakistan and China. But Doval is going a few steps ahead of him with his hard line on Kashmir, Pakistan and China. The ‘doctrine’ named after him and expounded by him in two lectures delivered in 2014 and 2015 is analysed here in the light of the Pathankot airbase attack

A former Director General of Police Punjab, a crusader against the drug-trafficker-politician nexus, observed in an interview (Outlook magazine, May 12) that a ‘sleeper cell’ of the terror groups was involved in the Pathankot attack.

India’s national security establishment, while dealing with the attack, had failed to examine the role of drugs-arms trafficking and money laundering networks operating in the border areas of Punjab and Pakistan with links to terrorists. This would have called for a cooperative approach between Indian and Pakistani security and criminal justice establishments.

Doval is a hawkish thinker, activist and speaker popular in the predominantly right wing middle class social circles of India. He has delineated his approach to Pakistani terrorism in his Nani Palkiwala Memorial Lecture, 2014 and the Lalit Doshi Memorial Lecture, 2015.

Pakistani terrorism against India, according to him, is a tactic to achieve ideological and political advantages.

So the enemy has to be engaged at three levels: defensive, defensive-offensive and offensive modes. The often resorted to ‘defensive’ mode is ineffective and irrelevant.

The “offensive-defensive mode” required going into Pakistan and tackling the problem where it originated. To make it clear, he used the famous phrase: “You may do one Mumbai; you may lose Baluchistan.”

This seemed to be crux of the Doval Doctrine. Either Pakistan give up terrorism against India as a state policy or India would let it “bleed with the Taliban”.

Doval states that terrorist organizations could be bought with money, weapons and manpower. Or a “paradigm shift” should occur with the use of high technology and “intelligence-driven covert operations”.

Doval used a boxing terminology and deplored the Indian tendency to punch below its weight. It must punch not below or above its weight but improve its weight to hit proportionately.

Doval emphasized that “individual morality should be imposed on the larger interest of the state”. The values of the state are above the values of individual.

Doval-approved covert operations were conducted by the then Army Chief General VK Singh who set the Technical Support Division and carried out several such ‘operations’ in Baluchistan, part of Pakistan, in 2015. Baluch dissident leaders were hosted in Delhi and the Baluch Liberation Organization (BLO) has existed in Delhi since 2009 (Indian Express, October 23, 2015).

Aggressive actions by Doval against Pakistan included the cancellation of the Foreign Secretaries’ meet in August 18 2014 and the NSA’s in August 22 2015.

Modi, on the advice of Doval, has adopted a hard line on Pakistan and has refrained from commenting on the peace efforts made by his predecessor Prime Minister Manmohan Singh in back channel diplomacy with President Musharraf and has ignored the four-point formula evolved to settle the Kashmir dispute.

China will provide 90 percent of the financial assistance for the 393-kilometre Sukkur-Multan Motorway, whereas remaining cost of the project will come from the Public Sector Development Programme (PSDP).

An official of the National Highway Authority Thursday said that physical work on the Sukkur-Multan Motorway costing Rs 294 billion had been started.

It is also a part of eastern route under the China-Pakistan Economic Corridor (CPEC), which will be completed within three years costing Rs 294 billion, the official said.

This motorway passing through Multan-Jalalpur Peerwala Ahmedpur East, Ubaro, Panno Aqil will terminate at Sukkur. Total 54 bridges will be constructed, including one major bridge on Sutlej, he added.

The official further said Karachi-Hyderabad Motorway (M-9), which connects Karachi to Hyderabad, is going to be 136-kilometre long with 16 exits and is going to cost about Rs 24 billion.

He said the M-9 would later be linked to the Karachi-Lahore and Karachi-Gwadar motorways to constitute the longest tract in the motorway network.

The National Highway Authority (NHA), the official said, is taking all possible measures to ensure the timely completion of the China-Pakistan Economic Corridor (CPEC).

"The CPEC project comprises modern highway and railway transportation system linking Kashgar in West China to Khunjerab in the north and onwards to Karachi and Gwadar in the south of Pakistan through multiple routes," he added.

He said that a number of sections of this mega project had been completed and remaining sections were under construction. He said that the 784-kilometer segment from Khunjerab to Burhan consists of Karakoram Highway (KKH), out of which 335 kilometre from Khunjerab to Raikot had already been upgraded.

The official said that the remaining part from Raikot to Islamabad was divided into three sub sections of Raikot-Thakot, Thakot-Havelian and Havelian-Burhan.

He said the construction work on 120-kilometre Thakot-Havelian section of the road has started after its ground breaking by Prime Minister Nawaz Sharif recently. He said that the work on 59-kilometre Burhan-Havelian section also known as Hazara Motorway was going smoothly and it would be completed by end of 2017 at a cost of Rs 34 billion.

The official said that work on 288km section of the western corridor from Burhan to Dera Ismail Khan would start within weeks. He said the project had been divided into five smaller sections so that work could be completed according to the given time frame. He said that Rs 13 billion PC-1 for acquiring the land required for the project had been approved.

The project envisages construction of 285km four-lane expressway from Hakla on M-1 to DI Khan near Yarik on N-55 as part of western route of the CPEC, he said.

The China Pakistan Economic Corridor (CPEC), a railroad which will traverse western China through Pakistan, will help job creation as well as help to curb terrorism as people grow more prosperous, Pakistan's former prime minister told CNBC on Wednesday.

The $46B deal agreed upon between China and Pakistan will allow China to avoid its current maritime sea routes to bring products into the Middle East and Europe.

"When you build a road or a highway through an area where there is none, you create economic activity, you create jobs, secondly new cities come up along that route , thirdly you have industrial estates coming so a lot of job creation takes place," said Aziz.

Despite a warning from the Pentagon that China is looking to set up a naval base in the country, the Pakistani army chief visited Beijing earlier this week to further discuss the project and the Pakistani army's involvement.

The Pakistani army will provide 15,000 special security forces to protect the investment in Pakistan, which has suffered greatly over the years due to security and terrorism issue.

"Whenever you have empty bellies, people get more vulnerable and subject to extreme behavior. If you create economic activity and give them a reason to live, if you give them a better tomorrow than yesterday, people tend to be more peaceful," said Aziz.

"We have seen over the years that in areas that have grown fast and where economic growth is strong, extremism and terrorism reduces," Aziz told CNBC.

"This is a serious initiative and we will do all what it takes to provide security and leverage this linkage between the warm waters of the Arabian sea all the way up to China."

Construction of an international standard highway was both challenging as well as enormous. Pakistan Army's Corps of Engineers, therefore, raised a special organisation named Frontier Works Organization (FWO) to undertake this virtually impossible task on 31st October 1966 to construct the Karakoram Highway (KKH). Resultantly, the founding of FWO owes its birth to one of the most significant and challenging project undertaken by Pakistan. The breathtaking task of chiseling across the mighty mountain ranges of Karakoram was accepted as a challenge with zeal and determination by the engineers of FWO. The project was unprecedented in the history of Pakistan and required tremendous technical skill in various fields like geology survey, concrete/masonry works and their designing, use of explosives, development of drilling and blasting techniques, besides administrative and logistic problems of a large work force of 15000 personnel spread over an inhospitable and harsh terrain for over 800km. The KKH being the highest road on earth has been acknowledged as 8th wonder of the World. Government of Pakistan, realizing the potential of FWO prior to the completion of KKH project, decided to retain FWO as a permanent organisation and expanded its sphere of activities throughout Pakistan.

FWO succeeded in its challenge and completed the exceptional task of KKH construction in 1978 after tremendous sacrifices. More than 1000 workers including 200 from our sincere friend China laid down their lives with over 1000 sustaining disabling injuries in their quest to achieve this national objective.

During the last half century, FWO has earned the reputation of Country's most prestigious, multidimensional and professional construction organisation which is committed to meeting the strategic needs of the Pakistan in versatile construction fields. FWO plays a pivotal role in socio-economic development and nation building through its unmatched contribution to infrastructure development. Over the years, FWO has been able to ensure performance par excellence despite time, budget and space constraints. The organisation is state of the art construction leader in civil as well as military spheres. Judicious utilisation of resources and adherence to modern construction practices is the hall mark of FWO. Taking a leap from its core competency of roads construction, FWO has excelled into large number of multifaceted infrastructure development projects.

This new paradigm shift has enabled FWO to serve the nation with utmost versatility and commitment. Today the domain of FWO projects range from blazing plateaus of Balochistan to lush green dales of Swat and Chitral; from the deserts of Sindh to snowcapped summits of Siachin.

FWO has a knack for accepting challenges and converting ideas into reality no matter how meagre are the resources. FWO has on its credit several initiatives which have contributed significantly in strengthening national communication infrastructure. FWO is also the pioneers and leader in Built-Operate-Transfer (BOT) regime in Pakistan. Lahore-Faisalabad road (LAFCO) is one such example. FWO has also been given the responsibility of constructing motorway between Karachi and Hyderabad (M-9) on similar BOT methodology.

Keeping up with its traditions of developing the far frontiers, FWO is active in building massive road network in Balochistan (around 900kms) which will bring prosperity in the region. Linkage of Gwadar further up North will provide Pakistan with tremendous potential for commercial activities through development of CPEC. ...

Keeping up with its traditions of developing the far frontiers, FWO is active in building massive road network in Balochistan (around 900kms) which will bring prosperity in the region. Linkage of Gwadar further up North will provide Pakistan with tremendous potential for commercial activities through development of CPEC. The Quick Impact Projects (QIPs) in Fata, Swat and other militancy hit areas by FWO have contributed significantly in changing landscape of militancy hit area. People of Fata have never been provided with such a sustained development which will facilitate durable peace and socio-economic development in the area. Fast development of energy and power generation projects such as Gomal Zam Dam and Dhana irrigation system, development of Central Trade Corridor (CTC) and nearly 700km roads network in Fata, are testimony of FWO’s contribution in eradicating militancy and terrorism from Fata. QIPs undertaken by FWO have changed the landscape of the area besides restoration of normalcy to the lives of affected population. With road infrastructure development, access of agriculture products and mining yields to bigger markets has unleashed a new era of prosperity in Fata.

Recently, National Highway Authority (NHA) has tasked FWO with conversion of existing 4 Lane Super Highway into a 6 Lane Karachi-Hyderabad Motorway (M9) on Build Operate and Transfer (BOT) basis. A consortium of banks headed by UBL provided the finances for the project.

FWO will maintain and operate the Motorway in line with international practices over the next twenty five years. This mega project was inaugurated by prime minister on 11th March 2015. All initiatives planned for M-2 shall also be extended to M-9.

On 25th Feb 2016, Governor Sindh Dr Ishrat-Ul-Ebad Khan while presiding a meeting to review the progress of ongoing mega development projects including the M-9 motorway overwhelmingly appreciated efforts of FWO in nation building. According to FWO, the work has already begun on the proposed M-9 project and negotiations are in progress to shift service stations to alternate locations. M-9 will be a state of the art project with modern CCTV cameras installed after every two kilometers, computerised signboards and automated toll tax collection system. Moreover, a total of 14 overhead bridges and underpasses will be constructed on the proposed route of M-9 for facilitating movement of population living on either side of the road.

Today, FWO with an envious track record, looks forward to greater challenges and stands better equipped to meet them. Our nation will remain highly indebted to the sacrifices of over 1000 lives of FWO workers while working in harsh climates and difficult terrain since its inception.

With growing list of national contributions each year, FWO will continue serving Pakistan with utmost humility. FWO is conscious of the responsibility given to it by the Pakistani nation and will maintain high standards of professionalism, sincerity and national commitment in times to come.

#China urges #Pakistan to let #Pak army, with its decades of infrastructure dev experience, lead #CPEC work https://www.ft.com/content/5eea66c0-4ef9-11e6-8172-e39ecd3b86fc

Frustrated with the slow progress on a sprawling, $46bn infrastructure project stretching from China to south Asia, Beijing is seeking to give Pakistan’s army a lead role.

Its desire to enlist Pakistan’s military is a sign of the challenges facing a crucial plank of President Xi Jinping’s signature One Road One Belt initiative. It was designed to increase China’s influence along the Silk Road and help the country export some of its excess industrial capacity.

Mr Xi made Pakistan an early stop on that road last year with the China-Pakistan Economic Corridor, a $46bn bundle of road, railway, electricity, oil and gas projects that marked the largest foreign investment in the nuclear-armed south Asian state.

But progress has stalled as the two sides work out how to turn the proposals into concrete projects, said Victor Gao, a former Chinese foreign ministry official, with some blaming Pakistan’s competing ministries.

“On the Pakistan side there is uncertainty about which entity wants to take leadership or ownership of the corridor projects,” he said. “There is a big debate internally [in Pakistan] over whether the government should take ownership or the military should take ownership. This is what is holding the whole thing up.”

The Pakistan military, which has detachments of civil, mechanical and electrical engineers, has had decades of experience with large infrastructure projects and analysts say the army is well placed to supervise the corridor.

But some politicians warn that military involvement will expand the army’s footprint on civilian matters and give the armed forces an even greater say in policymaking.

Security along the route, which traverses many volatile regions, is also a factor. “Because this project runs from Kashgar in Xinjiang to Gwadar, the CPEC’s route is very long and high-risk,” said Huang Rihan at the Center for China and Globalisation.

A 15,000-strong army-led security force has already been deployed to protect Chinese personnel assigned to the project.

Ultimately the new Silk Road will connect China’s western region, including the predominantly Muslim Xinjiang province, to the Chinese-funded Pakistani port city of Gwadar and significantly reduce the travel time between China and the Middle East.

“Pakistani politicians have squabbled over the route for the CPEC and this may have made people nervous in Beijing,” said a Pakistan government official. “Pakistan is a noisy place politically while the Chinese are not used to harsh disagreements, especially over such a vital project.”

Others attributed the hold-up to the long-term nature of the CPEC. “These projects will take many years to be completed, beyond the tenure of any one government,” said a foreign ministry official in Islamabad. “China wants to make certain that these projects will be completed as per plan”.

China is focused on securing a route to the Indian Ocean that would reduce dependence on the choke point of the Strait of Malacca between the Malay Peninsula and the Indonesian island of Sumatra.

Zaffar Hilaly, a former senior Pakistani diplomat and now commentator on national and security affairs, said: “The Chinese consider the Pakistan army a central player [for the country]. They see the army’s involvement with this project as a guarantee of its success.”

Pakistan’s armed forces have established close ties with Beijing as primary customers of China’s defence hardware, raising concerns in Delhi and Washington over a Sino-Pakistani military axis.

While Pakistan’s civil institutions responsible for public work increasingly show a dismal performance, the Pakistan army continues to remain responsible for a variety of construction-related mega projects in otherwise inaccessible areas.

This follows more than five decades of experience by the army in undertaking challenging assignments including the Karakorum Highway or KKH, the road built with Chinese assistance, which links China’s Xinjiang province with Pakistan’s northern Gilgit-Baltistan province and onwards to the country’s plains. At the outset with the CPEC too, the army’s promise to provide a full security cover for Chinese workers in Pakistan, marked the critical element that buttoned up this project.

In the long term, Pakistan’s ruling politicians may have a valid point in seeking to lead the CPEC initiative. And yet, that ambition needs to be built with a long overdue reality check. The country’s civilian authorities need to embark on an internal reform plan first rather than seek to block the army from assuming a lead role in the execution of the CPEC.

Such a plan must be built upon three equally vital aspects. First, there needs to be a complete political consensus over the geographic layout of the CPEC and its associated projects. Signs of infighting between different political groups have in fact harmed the view of Pakistani politicians, reinforcing their image as a short-sighted warring bunch rather than a mature and politically responsible community.

Second, it’s vital to put safeguards in place for a radical improvement in the performance of key civil institutions, enabling them to take greater responsibility for the execution and eventual management of CPEC related projects. The total work cut out under this initiative will likely continue till the end of the next decade if not beyond. This creates a sufficient time frame for the army to first take charge of this valuable initiative and hand over responsibilities for its eventual management to Pakistan’s civilian infrastructure following a set of robust reforms.

Finally, it’s important for Pakistan’s ruling politicians to consider different types of fallouts from antagonising the armed forces, all in the name of promoting democracy. In the case of the CPEC, some politicians have eagerly pushed for exclusive civilian control on this project as a step towards strengthening Pakistan’s democratic evolution. Yet their initiative will only be an exercise in futility until such time that they reconcile themselves with Pakistan’s fundamental realities.

For now, General Raheel Sharif and the Pakistan army exclusively remain the main guarantors for the success of what is set to transform Pakistan as never before.

Work on the projects of western route of Pakistan China Economic Corridor (CPEC) is continuing rapidly and will be completed by December 2016, official sources said. CPEC will benefit all the provinces especially Balochistan, Khyber Pakhtunkhwa and Federally Administered Tribal Areas (FATA).According to data released by Planning Commission of Pakistan, 335 km long Khunjerab to Raikot road is complete while the feasibility study of 270 km Raikot to Thakot road is complete. Work is continuing on Burhan-Havelian expressway, 280km long Burhan-Dera Ismail Khan road, 124km DI Khan-Mughalkot road, 81 km Zhob-Mughalkot road, 454km Khushab-Saryab road and 193 km Khushab-Gwadar road.The federal government has given considerable importance to the project and made substantial allocations for it in this year’s financial budget. CPEC project includes new power stations and special industrial zones to spur regional trade.

Chief of Army Staff (COAS) General Raheel Sharif has on Monday said that building 1000 kilometer long China-Pakistan Economic Corridor (CPEC) was an honour for Frontier Works Organisation (FWO). He said that FWO had become a strategic organisation after years of hard work, reported Dunya News.

According to Inter-Services Public Relations (ISPR) department, General Raheel Sharif attended FWO’s Golden Jubilee ceremony, where he praised FWO for its extensive construction experience and completion of massive projects.

Army chief said that FWO had completed projects like Karakoram Highway, Central Corridor linking Afghanistan with Waziristan, Coastal Highway and several hydel projects. He congratulated FWO over the completion of such extraordinary projects.

In the modern concept of infrastructure development, Public Private Partnership (PPP) has attained importance and popularity. Build-Operate-Transfer (BOT), is a project financing and operating model or structure and is a form of PPP wherein a private entity receives a concession from the private or public sector to finance, design, construct, and operate a facility stated in the concession contract which varies from 20 to 30 years. The facility may be a power plant, airport, toll road, tunnel, water treatment plant or any other public utility project. The concession period is determined primarily by the length of time needed for the facility's revenue stream to pay off the company's debt and provide a reasonable rate of return for its effort and risk. This enables the project proponent to recover its investment, and project operating and maintenance expenses. After completion of the concession period, ownership is transferred back to the granting entity which may be federal, provincial or local government or its department. This profit sharing principle is the key aspect differentiating the BOT approach from the outsourcing arrangements commonly undertaken in the country. BOT has found its application in recent years primarily in the area of infrastructure privatization especially in the developing countries.

BOT utilizes the private sector financing to provide new sources of capital, which reduces public borrowing and direct spending, facilitating the governments to develop projects that would otherwise compete for scarce sovereign resources.

Public-Private Partnership - A

Necessity for Pakistan.

In Pakistan, 95 percent of the total goods traffic and 90 percent of passenger traffic utilize roads, whereas only 5% goods and 8% passengers use Railway for their transportation. Only 2% passengers move by air. In view of such a situation, road network bears the maximum traffic load in the country. Total Asset of road infrastructure is about 45,940 Lane Kms. Its Routine Maintenance cost is calculated at Rs.5 Billion/annum, whereas it's Periodic Maintenance Cost is about Rs. 30 Billion/annum. Its current revenue collection however amounts to only about Rs. 15 Billion/annum whereas its Operational Cost is about Rs. 7 Billion/ annum. Thus there is a shortfall of Rs. 27 Billion/ annum. As evident, even maintenance of the existing infrastructure is not possible from within the revenues generated out of this infrastructure. To meet the ambitious goals of completing and maintaining the large motorway network in the country as planned by Government of Pakistan, Public-Private Partnership is, therefore an inescapable necessity. In view of the meager budgetary resources and revenue generation National Highway Authority has floated various BOT schemes in this context.

FWO - Pioneer of BOT in Pakistan

FWO, being one of the largest construction organization having internationally competitive financial, manpower and machinery assets, readily accepted the challenge and offered to undertake first ever BOT projects. Various completed and ongoing BOT projects being implemented by FWO are as under:

Prime Minister Muhammad Nawaz Sharif, Wednesday (today) said that the development of Balochistan means a new Pakistan is in the making.

“Building up of a new Balochistan means that a new Pakistan is being built,” the premier said while addressing a gathering in Turbat in connection with the inauguration of Sorab-Hoshab Highway N-85 on Wednesday.

The 448 km long Sorab-Hoshab highway forms an important link on the western route of the China-Pakistan Economic Corridor (CPEC) and has been built at an estimated cost of Rs22 billion.

“I have visited Balochistan the most number of times during my current tenure as prime minister and it has always been to inaugurate a project…this road will bring prosperity to the area,” Nawaz added.

“Travelling from Quetta to Gwadar used to take two days but now with the help of this road one can leave Quetta at sunrise and reach Gwadar by noon,” the prime minister said.

The prime minister said the road was proof that the government had brought progress back to the region.

“A new road brings new opportunities and gives new life to an area… you’ll see the progress in your area,” Prime Minister Nawaz said, adding that he did not want “to repeat the tale of how Balochistan was neglected, but now we will change the face of Balochistan, and Pakistan.”

“This road will connect Balochistan to the National Highway, to the rest of the country and to Afghanistan. The people of Gilgit-Baltistan will also benefit from it,” the premier said.

Criticising previous regimes, the prime minister said “those before us had this opportunity, but they wasted it…this work can only be done by someone with a vision. We have this vision…not only are we making roads…these roads are bringing children closer to schools and bringing employment and livelihood to the poor”.

Meanwhile, in an apparent reference to Pakistan Tehreek-e-Insaf (PTI) chairman Imran Khan, Nawaz said some people think they can assume power by creating an uncertainty in the country. The nation is able to determine the ones working for the development of the country as well as those playing with their emotions, he remarked.

Development, the premier reiterated, is the only way to take this country forward and the incumbent government has made it clear that the only way to rule is through service to the masses.

“Pakistan has to develop both in terms of material and spirit as this country has a history of ethical traditions and respect for each other,” Nawaz said before adding, “Masses will decide Pakistan’s fate in 2018 which is going to be a better year for the country.”

The project links Gwadar Port with National Highway network (N-25) near Surab/Quetta.

The road would provide the shortest link to Afghanistan and other Central Asian countries with Gwadar Port. With the completion of this project, the vital North-South road connectivity has also been completed.

#Pakistan Opens New 340MW Nuclear Power Plant Built With #China's Help. #CPEC

http://www.voanews.com/a/pakistan-nuclear-reactor/3653908.html

Pakistan Prime Minister Nawaz Sharif has inaugurated a nuclear power facility built with the assistance of China.

The plant at Chashma, in Pakistan's Punjab province, adds 340 megawatts to the national grid. Beijing has already constructed two other nuclear reactors, with a combined capacity of more than 600 megawatts.

The three power plants at Chashma are known as C-1, C-2 and C-3 respectively. They are are part of broader plans to overcome long-running crippling power shortages in Pakistan.

“The next (nuclear) power projectwith an installed capacity of 340 megawatts, C-4, is also being built here (in Chashma with Chinese assistance). God willing, it will be operational and connected to the national grid in April, 2017,” Sharif told Wednesday’s ceremony.

Pakistan’s current electricity output stands at around 16,000 megawatts, including nuclear power production.

The government plans to increase the power production by about 60 percent, mainly through Chinese-funded coal, gas and hydro-electricity projects under construction to try to boost Sharif’s re-election bid in next polls due in early 2018.

When Sharif took office in 2013Pakistanis were facingcompulsory power outages for up to 12 hours a day, crippling daily life and plunging businesses into darkness.

The prime minister in his speech Wednesday reiterated his election promise to resolve the crisis by the next elections.

Officials say that Chinese experts and engineers had been running the newly-built C-3 plant “on a trial basis” for three months until they formally handed over its control to their Pakistani counterparts Wednesday.

Beijing is also helping Islamabad construct two nuclear power plants in the southern port city of Karachi at a cost of around $10 billion. The projects, with a combined capacity of around 2,200 megawatts, are scheduled to be completed by 2021.

Under the agreement, China will also provide enriched uranium for fuel.

The Pakistan Atomic Energy Commission (PAEC) envisages a nuclear power production of around 8,800 megawatts by 2030.

Pakistan built its first nuclear power plant of 137 megawatts at Karachi in 1972 and it is still in operation, though at a much reduced capacity.

China is the only country helping Pakistan build nuclear power plants because Western nations have put a moratorium on the supply of these facilities citing Islamabad’s nuclear weapons program.

Under a multi-billion dollar cooperation agreement, Beijing is also helping Pakistan construct a network of roads, rails, communication and power projects to boostties between the two traditionally close allies.

The bilateral cooperation under the China-Pakistan Economic Corridor (CPEC) plans to link the northwestern Xinjiang region to Pakistani deep-water port of Gwadar Gwadar in the Arabian Sea, providing Beijing the shortest possible access for its imports and exports to international markets.

The rapidly populating coastal region from the Gulf to Pakistan faces a huge tsunami risk

That tsunamis can cause death and devastation has become painfully clear over the past two decades. On Boxing Day, 2004, a magnitude 9 earthquake off the coast of Sumatra caused waves several metres high to devastate the Indian Ocean – killing more than 230,000 people in 14 countries. In 2011, another magnitude 9 earthquake, this time off Japan, produced waves up to 20 metres in height, flooding the Fukushima nuclear reactor. It killed more than 15,000 people.

A new study, published in Geophysical Journal International, by my colleagues and me suggests that a 1,000km long fault at the northern end of the Arabian Sea may pose a similar threat.

The Makran, as the southern coastal region of Iran and Pakistan is known, is a subduction zone. In such regions, one of the Earth’s tectonic plates is dragged beneath another, forming a giant fault known as a “megathrust”. As the plates move past each other, they can get stuck, causing stress to build up. At some point the stress becomes high enough that the megathrust breaks in an earthquake.

This was exactly what caused the Sumatra 2004 and Tohoku 2011 earthquakes. When a megathrust moves suddenly, the whole seafloor is offset and the water has to move out of the way over a huge area. This sets off waves with particular characteristics that can cross entire oceans: tsunamis. The phenomenon, along with their potentially large size, makes subduction zone earthquakes particularly dangerous.

But just because a part of a subduction zone produces earthquakes doesn’t mean that the whole megathrust can move in one go. We often see that stress builds up at different rates on different parts of the fault, with some parts sliding smoothly past each other. How much of a megathrust can move in one go is important because it determines the size of the resulting earthquake. The amount that the Makran megathrust can move in earthquakes has been a longstanding question, but the hostile climate and challenging politics of the region have made research there difficult.

We know that the eastern part of the Makran megathrust (in Pakistan) can produce large earthquakes. A magnitude 8.1 quake off the coast of western Pakistan in 1945 caused a tsunami which killed about 300 people along the coasts of Pakistan and Oman. There have been several smaller earthquakes on the megathrust since, including a magnitude 6 in February this year.

If the western part of the Makran (in Iran) also produces earthquakes – and the whole Makran megathrust were to move in one go – it could produce a magnitude 9 earthquake, similar to those in Sumatra and Tohoku.

However, we have never actually recorded a subduction earthquake in this part of Makran. In fact, there are only records of one candidate quake from 1483 – and the actual location of this is disputed. But it’s important to keep in mind that just because we haven’t seen an earthquake doesn’t mean that there couldn’t be one – particularly since the intervals between earthquakes are often hundreds or thousands of years. Historically, not many people have lived in the remote Iranian Makran, a desert which killed Alexander the Great’s army. So earthquakes might simply not have been documented.

The construction and land acquisition work on all portions of the Western Route of China Pakistan Economic Corridor is under way and the major work on the Route is expected to be completed by next year.The shortest of all CPEC routes is Western Alignment of the CPEC which is 2,463 km length and starts from Khunjrab, passing through Burhan (Hakla), DI Khan (Yarik), Zhob, Quetta,Surab and Hoshab and terminates at Gwadar.An official of Planning Commission told APP that the Western Routes’ 615 Kilometer Khunjrab Raikot section has already been completed while Havelian Abotabad Manshehra (40 km) section will be completed by May, 2018.He said work on construction of all five sections of Hakla D.I.Khan Expressway had begun.This project is an important part of Western Route of CPEC and the 285 km long Motorway will be completed in two years at a cost of more than Rs 142 billion.He said that the project alignment started at Hakla,near Tarnol interchange on M 1 and passes through Fateh Jhang,Mianwali,Kundal and ended at Yarak at Indus Highway (N 55).He said that the alignment of motorway passed through developing areas and its construction would generate new employment opportunities.Availability of high speed transportation will pave way for improvement of health and education sectors as well, and local produces will easily be taken to the big markets.He said that ground breaking of the up gradation of Zhob Mughalkot section was performed by Prime Minister Nawaz Sharif in December 2015.He said that rehabilitation of D.I.Khan Mughalkot section of N 50 would be completed by 2018. Moreover he said that dualization of 531 km D.I.Khan to Kuchlak section of N 50 would be operational by 2020.The objective of the CPEC was to promote trade ties with neighboring countries Central Asian States and South Asian countries, which would ultimately make Pakistan a trade hub in this whole region, he said.Similarly, the Sorab Hoshab highway forms an important link on the western route of the China Pakistan Economic Corridor (CPEC) and has been completed at an estimated cost of Rs 22 billion.The highway is 449 kilometers long and links the Gwadar port to the north.The official said that with the completion of the highway, the distance time from Gwadar to Quetta had been reduced from 48 hours to only 10 hours.

The western route of the China-Pakistan Economic Corridor (CPEC) is going to be completed by the end of this year along with other 11 mega projects which were initiated in 2015-16.

The completion of those projects will reduce travelling time and boost economic activities.

“Hakla-DI Khan having the length 285km with a cost of Rs122 billion and 81km Zhob-Mughalkot costing Rs8.8billion funded by the Asian Development Bank (ADB) will be completed by December 2018,” a senior National Highway Authority (NHA) official told The Express Tribune.

“The completion of these two projects will connect the port city of Gwadar with Quetta by Khuzdar,” he said and added, “With it the western route will become completely functional.”

According to the NHA the under-construction projects – the Hakla to Dera Ismail Khan motorway — is an important part of the western route of CPEC, and will reduce the travel time from Islamabad to DI Khan from five hours to just two-and-a-half hours.

It will greatly help the movement to the country’s southern cities such as Quetta and Gwadar.

Meanwhile, another important project — Khuzdar- Ratodero (151 km) that has been completed at a cost of Rs8.8 billion is all set to be inaugurated this year in April.

This project though is not part of CPEC.

“The significance of this project is that it will provide the much-needed connectivity between Balochistan and Sindh and also facilitate CPEC traffic originating from the Gwadar Port,” said the NHA official.

Other projects include the Karachi-Hyderabad Motorway (M-9) where 95% work has already been completed and will see the finish line in March.

The 136km, the six-lane motorway with the two-lane service road on either side, is being built on the BOT basis at a cost of Rs44 billion.

Being the country’s busiest section with over 30,000 daily traffic count, this motorway will be immensely helpful in catering to the commercial traffic originating from the Karachi Port and the Port Qasim.

Following the recent inauguration of the Lyari Expressway, M-9 will offer an added benefit to commuters to reach their destinations without facing the city congestions.

Gojra-Shorkot (62km) and Shorkot-Khanewal (65km) sections of M-4 are scheduled to complete by August with a cost of Rs17 billion and Rs22 billion, respectively.

Financed jointly by the Asian Development Bank and Government of Pakistan, their completion will reduce travel time from the federal capital to Multan to just 5 hours.

Lahore-Abdulhakim Motorway (230 km) is another important project that is expected to complete by May. Built at a cost of Rs 148 billion, the six-lane motorway will provide a swift and easy route between Lahore and Multan.

CPEC toll income — myth and reality

One of the important links of CPEC and the country’s longest planned motorway, Multan-Sukkur (M-5) is though scheduled to complete in 2019.

Its two sections — Multan to Shujaabad and Pano Aqil to Ghotki — will be completed this year. The 392km-long motorway is being financed by China at a cost of Rs294 billion.

Lahore-Sialkot Motorway (89 km) will be completed on the BOT mode by December at a cost of Rs44 billion. It will link the industrial city of Sialkot with the rest of the country, leading to swift movement of industrial products.

Islamabad Metro Bus (26.5km), another challenging project, is under execution and will be completed by the end of April. The project will link the traffic from the twin cities with the New Islamabad International Airport (NIIA).

Hazara Motorway (E-35) from Burhan to Shah Maqsood Interchange (47km) is already completed and open to traffic. The 15km addition is scheduled to complete by May, thus reducing the distance between Islamabad and Abbottabad to one-and-a-half hours.

The widening and improvement of GT Road section from Thokar Niaz Baig to Hudria Drain (10km) is underway and will be completed this year.

A drive on the newly-constructed highway connecting the port city to Ratodero reveals the trials and tribulations of building infrastructure in conflict-ridden areas

There is great buzz about the M-8 project in Balochistan — locals who use the road on a daily basis say that it has greatly reduced the time needed to travel from Gwadar to Turbat, and indeed, reduced the time for produce and supplies to be transported between cities.

And yet, great things in Balochistan tend to arrive in small, sometimes troubling packages.

A drive on the newly-constructed highway connecting the port city to Ratodero reveals the trials and tribulations of building infrastructure in conflict-ridden areas

Also known as the Gwadar-Ratodero Motorway, the M-8 falls under the purview of the National Highway Authority (NHA). In theory, it is an 893-kilometre-long “motorway” that is supposed to facilitate the movement of people and goods to and from the port city of Gwadar.

Explore: Footprints: Road trip Balochistan

The western end of this motorway is actually a junction known as the Karwat ‘zero point’, some 50 kilometres away from Gwadar. From Karwat, the road snakes through rugged terrain, first to Turbat, then to Hoshab and onwards to Khuzdar.

From Khuzdar, the highway takes a turn towards Sindh, to the town of Ratodero — the “eastern end” of the M-8. Ratodero has gained prominence in recent times for being the lynchpin of the China-Pakistan Economic Corridor (CPEC). The town is a junction where the CPEC’s western, central and eastern road routes all converge. And it is from here that trade between provinces will originate.

The M-8, therefore, is what ties the CPEC plan all together.

Late last year, the Frontier Works Organisation (FWO), who were contracted by the NHA to build the motorway, completed construction of a 200-kilometre-long strip between Gwadar and Hoshab. And although the project is yet to be formally handed over to the NHA, the road is already in use.

---

A rocky beginningTwist in the tale: the M-8 wasn’t a CPEC-specific project to begin with.

The M-8 project is also known as the Gwadar-Ratodero Motorway. The project is divided into two sections; the first from Gwadar to Khuzdar, and the second from Khuzdar to Ratodero. Work on the 200-kilometre-long Gwadar to Hoshab segment began back in 2004 under the regime of General Pervez Musharraf. This track was supposed to have been completed in 2006. It has taken 13 long years for construction to conclude.

“The M-8’s first contractor was a Chinese company named Xinjiang Beixin Road & Bridge Group Co. Ltd," explains Muhammad Musa, NHA’s project director in Kech District. “But they left the project when three Chinese engineers were killed in a car bomb blast in Gwadar during the first week of May, 2004.”

The Chinese firm had managed to complete 30 kilometres of the project, from Naleint to Talaar, during their short stint. The construction contract was then awarded to D. Baloch, but for some reason (possibly security-related), they, too, were unable to complete the work.

“The M-8 has gone through many contractors but nobody was able to work on it properly,” says Musa, “until the project was awarded to the FWO in June 2014.”

The FWO was responsible for completing all aspects of construction by October 31, 2017.

But the construction process was marred by violence ever since work started. In July 2015, for example, a press release issued by the Inter-Services Public Relations (ISPR) disclosed that six military personnel and 10 civilian employees of FWO were martyred and 29 severely injured in 136 security-related incidents. Similarly, on May 19, 2017, at least three labourers were gunned down in the Hoshab Bazaar. Despite the violence, work carried on and the highway finally saw the light of day late last year.

THERE was a time when the drive from Gwadar to Quetta could take up to five days, across gruelling jeep tracks. But now you can do it in two if you want to take it easy, or even one if you’re in a rush, on a highway so smooth you can sip tea while driving. How this happened is a story that weaves together the disparate strands that make up Pakistan’s troubled political landscape, as well as the forbidding geography of the terrain through which the road travels.

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The route takes you across three highways. The M8 motorway from Gwadar to a small town called Hoshab, largely invisible from the road, near Turbat. From there it links up in an elegant Y-shaped turn with the N85, an almost 700km-long highway-grade road that takes you to the N25, which carries you through Kalat and Mastung before arriving at the mouth of the Lakpass tunnel at the entrance of Quetta.

Some commercial traffic has already begun to ply to road, mostly of local origin.Only a few years ago the journey was nearly impossible to make. When I covered the NFC award ceremony in Gwadar in December 2009, I asked my bureau chief in Quetta about the possibility of travelling there straight from Gwadar.

This time was different; the road was impeccable. And although security remains a concern, matters are vastly improved since at least a year.

---

“The first year was difficult,” says one of the officers I’m driving with. “IED [improvised explosive device] attacks were common, rocket fire was regular. It was quite difficult working here initially.” Almost 40 people were killed in that first year, half army and half civilian, and another 350 were injured, some seriously.

---“What is the difference between the way Baloch militants fight versus the TTP,” I asked one of the officers who saw action in Fata.

Traffic is thin on the desolate highway.“Big difference,” he replied. “First, TTP fighters, once they open engagement, will stay and fight until either you or they are dead. Baloch fighters, on the other hand, don’t stick around very long after the first few shots have been fired. You don’t really get to see them. Second, the TTP are far more tactically sophisticated and will only engage with you when they know they have heavy odds of winning. These guys on the other hand seek an opportunity to exploit, do their work, and flee the scene quickly.”

A map showing the route taken through Balochistan.The engineers working on the road see it as a hearts and minds project. “With the road, there comes a small cottage industry, and with travel comes exposure,” one of them tells me. A few signs of this can be seen after long intervals, with small tea shops springing up on some stretches of the road; but the region is so desolate that one can travel for almost a hundred kilometres in some places without seeing any sign of life.

This is no ordinary road. The FWO men who built it have spent more than two years deployed in the area. At its peak, there were almost 7,000 of them but now the figure has come down to 5,000 army and 7,000 civilian contractors. “When we first came, many of the people in this area had no concept of the outside world,” one of them tells me. “They viewed us with suspicion. But now that they have had some exposure, and are able to travel more easily, their outlook is beginning to change.”

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Cloudcade:

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About Pakistan, the report says that "although the country has a number of factors that coincide with racial intolerance – sectarian violence, its location in the least-tolerant region of the world, low economic and human development indices – only 6.5 percent of Pakistanis objected to a neighbor of a different race. This would appear to suggest Pakistanis are more racially tolerant than even the Germans or the Dutch".

Housing Discrimination:

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Human Development in Pakistan:

UNDP’s Human Development Index (HDI) represents human progress in one indicator that combines information on people’s health, education and income.

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I am the Founder and President of PakAlumni Worldwide, a global social network for Pakistanis, South Asians and their friends. I also served as Chairman of the NEDians Convention 2007. In addition to being a South Asia watcher, an investor, business consultant and avid follower of the world financial markets, I have more than 25 years experience in the hi-tech industry. I have been on the faculties of Rutgers University and NED Engineering University and cofounded two high-tech startups, Cautella, Inc. and DynArray Corp and managed multi-million dollar P&Ls. I am a pioneer of the PC and mobile businesses and I have held senior management positions in hardware and software development of Intel’s microprocessor product line from 8086 to Pentium processors. My experience includes senior roles in marketing, engineering and business management. I was recognized as “Person of the Year” by PC Magazine for my contribution to 80386 program. I have an MS degree in Electrical engineering from the New Jersey Institute of Technology.
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